Income Taxes

9 Months Ended

Sep. 30, 2022

Income Taxes

Income Taxes

8. Income Taxes

Income tax provisions for the three and nine months ended September 30, 2022 and 2021 are as follows:

	Three months ended September 30,				Nine months ended September 30,
	2022		2021		2022		2021
Current:
Federal	$	2,566,416	$	1,016,953	$	6,564,117	$	1,491,880
State		1,209,063		508,588		3,093,510		781,620
Total current income tax expense		3,775,479		1,525,541		9,657,627		2,273,500
Deferred:
Federal		98,367		(679,361)		353,980		(467,203)
State		22,164		(203,108)		85,877		(184,403)
Total deferred tax expense		120,531		(882,469)		439,857		(651,606)
Income tax expense	$	3,896,010	$	643,072	$	10,097,484	$	1,621,894

The Company files federal income tax returns in the United States and Canada, and various returns in state and local jurisdictions.

The Company believes it has appropriate support for the income tax positions taken and to be taken on our tax returns and that the accruals for tax liabilities are adequate for all open years based on our assessment of various factors including past experience and interpretations of tax law applied to the facts of each matter. The Company's tax returns are open to audit under the statute of limitations for the years ending December 31, 2018 through December 31, 2021. To the extent we utilize net operating losses generated in earlier years, such earlier years may also be subject to audit.

Our effective tax rate will typically differ from the statutory federal rate primarily as a result of state income taxes and the valuation allowance against the Canadian net operating loss. The effective tax rate for the three and nine months ended September 30, 2022 was higher than the statutory federal rate as a result of the state income taxes, excess officer compensation, and the valuation allowance against the Canadian net operating loss.