INCOME TAXES

3 Months Ended

Mar. 31, 2024

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

Tax Rate for the three months ended March 31, 2024

The Company recognized an income tax benefit at an effective income tax rate of 70.8% for the three months ended March 31, 2024. The effective income tax rate was impacted by state and local income taxes, the tax effect of bankruptcy-related fees, and certain statutory non-deductible items.

Tax Rate for the three months ended March 31, 2023

The Company recognized an income tax benefit at an effective income tax rate of 19.5% for the three months ended March 31, 2023, which was determined using a forecasted rate based upon projected taxable income for the full year.

Pending IRS refund claim

The Company was able to carryback its 2020 federal income tax to its 2018 tax year and filed a refund claim with the IRS for a total of $5.5 million.

Net Deferred Tax Assets and Liabilities

The income tax accounting process to determine the deferred tax liabilities involves estimating all temporary differences between the tax and financial reporting bases of the Company’s assets and liabilities, based on enacted tax laws and statutory tax rates applicable to the period in which the differences are expected to affect taxable income. The Company estimated the current exposure by assessing the temporary differences and computing the provision for income taxes by applying the estimated effective tax rate to income.