Income Taxes

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

13. INCOME TAXES

For the years ended December 31, 2021, 2020 and 2019, the (benefit from) provision for income taxes is comprised of the following:

	2021			2020			2019
Current income tax provision	(In thousands)
Federal	$	(31	)	$	(136	)	$	(77	)
State		3,984			1,020			1,580
Foreign		—			5			27
Total current income tax provision		3,953			889			1,530
Deferred income tax (benefit) provision:
Federal		345			(19,718	)		21,825
State		(4,462	)		(11,696	)		16,173
Total deferred income tax (benefit) provision		(4,117	)		(31,414	)		37,998
Total income tax (benefit) provision	$	(164	)	$	(30,525	)	$	39,528

The deferred income tax (benefit) provision represents the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Cash paid for income taxes totaled $5.9 million, $0.5 million and $1.4 million, for the years ended December 31, 2021, 2020 and 2019, respectively.

The components of deferred income tax assets and liabilities as of December 31, 2021 and 2020 are as follows:

	2021			2020
Deferred income tax assets:	(In thousands)
Acquisition and debt related costs	$	4,292		$	4,128
Net operating losses		199,656			272,943
Goodwill impairment		53,677			53,887
Self-insurance		7,220			7,410
Deferred revenue		2,878			5,707
Restricted stock		9,509			2,826
Tax credits		10,718			10,577
Legal settlements		855			645
Lease obligations		29,410			29,943
Interest limitation		562			463
Charitable contributions		3,243			3,977
Other		6,115			2,084
Total deferred income tax assets		328,135			394,590
Valuation allowance		(4,775	)		(65,617	)
Net deferred tax assets		323,360			328,973
Deferred income tax liabilities:
Property and equipment		(194,739	)		(211,729	)
Amortization - Goodwill		(55,827	)		(51,435	)
Amortization - Other intangibles		(29,482	)		(26,080	)
Right of use assets		(29,004	)		(29,631	)
Other		(3,116	)		(3,023	)
Total deferred income tax liabilities		(312,168	)		(321,898	)
Net deferred income tax assets	$	11,192		$	7,075

The Company files federal, state and provincial income tax returns in various jurisdictions with varying statute of limitation expiration dates.  Under the tax statute of limitations applicable to the Internal Revenue Code of 1986, as amended (the “Code”), the Company is no longer subject to U.S. federal income tax examinations by the Internal Revenue Service for years before 2017.  However, because the Company is carrying forward income tax attributes, such as net operating losses and tax credits from 2009 and subsequent years, these attributes can still be audited when utilized on returns filed in the future.  The Company has determined that there are no positions currently taken that would rise to a level requiring an amount to be recorded or disclosed as an unrecognized tax benefit. If such positions do arise, it is the Company’s intent that any interest or penalty amount related to such positions will be recorded as a component of the income tax provision in the applicable period.

The Company has federal tax net operating loss carryforwards of approximately $0.7 billion as of December 31, 2021 and state net operating loss carryforwards spread across various jurisdictions with a combined total of approximately $1.0 billion as of December 31, 2021. These net operating loss carryforwards, if not used to reduce taxable income in future periods, will begin to expire in 2030 and 2029, for federal and state tax purposes, respectively.

Realization of the deferred income tax assets, primarily arising from these net operating loss carryforwards and charitable contribution carryforwards, is dependent upon generating sufficient taxable income prior to expiration of the carryforwards, which may include the reversal of deferred tax liability components.  

Through December 31, 2020, approximately $65.6 million of valuation allowances were established for some of the Company’s deferred tax assets, which, based on its analysis at the time, the Company believed did not meet the “more likely than not” criteria and would expire before being realized in future periods.  These valuation allowances consisted of the following as of December 31, 2020: approximately $39.5 million for federal net operating loss carryforwards, approximately $7.1 million for federal tax credits, approximately $4.0 million for federal and state charitable contributions and approximately $15.0 million, net of federal tax benefit, for state net operating losses. Based on the Company’s assessment of the realizability of its deferred tax assets during the year ended December 31, 2021, which included a review of current and forecasted financial performance, the Company believes that some of these deferred tax assets now meet the “more likely than not” criteria and will be realized in future periods before they expire. As a result, the Company reversed its valuation allowances by approximately $60.8 million during the year ended December 31, 2021. As of December 31, 2021, the Company has a remaining valuation allowance of approximately $4.8 million, net of federal tax benefit, on the deferred tax assets related to state net operating loss carryforwards. The Company’s valuation allowances, in part, rely on estimates and assumptions related to future financial performance.  Given the macroeconomic environment related to the COVID-19 pandemic and the uncertainties regarding the related impact on financial performance, the Company’s valuation allowances may need to be adjusted in the future.

The reconciliation between the statutory income tax rate and the Company’s effective income tax (benefit) provision rate for the years ended December 31, 2021, 2020 and 2019, is as follows:

	2021							2020							2019
	Amount			%				Amount			%				Amount			%
	(In thousands)
Income tax at federal statutory rates	$	53,833			21.00		%	$	(71,998	)		21.00		%	$	27,091			21.00		%
State taxes, net of federal benefit		12,070			4.71				(15,816	)		4.61				7,645			5.93
Equity-based compensation		(8,051	)		(3.14	)			(485	)		0.14				(1,776	)		(1.38	)
Tax credits		(137	)		(0.05	)			(304	)		0.09				(795	)		(0.62	)
Impact of state rate changes		(753	)		(0.29	)			(3,906	)		1.14				3,770			2.92
Officer's compensation limitation		3,437			1.34				95			(0.03	)			434			0.34
Valuation allowance - state		(13,756	)		(5.37	)			10,450			(3.05	)			2,455			1.90
Valuation allowance - federal		(47,061	)		(18.36	)			49,951			(14.57	)			—			—
Other		254			0.10				1,488			(0.43	)			704			0.55
Income tax (benefit) provision	$	(164	)		(0.06	)	%	$	(30,525	)		8.90		%	$	39,528			30.64		%