Income Taxes

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Income Taxes

(3) Income Taxes

The provisions for income taxes are:

	2020			2019			2018
Current:
Federal	$	(1,197	)	$	(235	)	$	5,641
State		(3	)		(151	)		1,777
Foreign		2,831			2,956			2,121
Deferred:
Federal		2,177			2,867			650
State		403			1,548			(365	)
Foreign		(1,131	)		(1,783	)		(679	)
	$	3,080		$	5,202		$	9,145

Total income tax expense differed from the amounts computed by applying the U.S. Federal income tax rate of 21.0% to income before income tax expense, as a result of the following:

	2020			2019			2018
Computed tax expense at statutory federal rates	$	3,874		$	3,993		$	7,054
Increase (decrease) in taxes resulting from:
State taxes, net of federal income tax benefit		559			1,131			1,627
Unrecognized tax benefits		(2,092	)		263			171
Bargain purchase gain on business acquisition		(978	)		—			—
Impact of the enactment of the Tax Cuts and Jobs    Act (net)		—			—			1,089
Income tax credits		(812	)		(819	)		(689	)
Foreign tax rate differential		2,145			341			(37	)
Subpart F income		—			—			14
(Gain) on equity investments		—			—			(61	)
Stock based compensation		377			366			277
Global intangible low-taxed income		—			249			—
Other		7			(322	)		(300	)
	$	3,080		$	5,202		$	9,145

Income before provision for income taxes and losses on equity investments are:

	2020		2019		2018
Domestic	$	11,858	$	15,465	$	26,124
Foreign		6,589		3,547		7,472
	$	18,447	$	19,012	$	33,596

Temporary differences between the financial statement carrying amounts and tax bases of assets and liabilities that give rise to significant portions of the net deferred tax liability at December 31, 2020 and 2019 relate to the following:

	2020		2019
Deferred tax asset
Inventories	$	1,416	$	2,912
State income taxes		—		328
Program accrual		7,306		7,529
Vacation pay accrual		815		756
Accrued bonuses		589		599
Bad debt expense		952		627
Stock compensation		2,079		2,755
NOL carryforward		2,142		1,141
Tax credits		931		824
Lease liability		3,378		3,308
Accrued expenses		347		334
Other		967		(125	)
Deferred tax asset	$	20,922	$	20,988
Deferred tax liability
Plant and equipment, principally due to differences in            depreciation and capitalized interest	$	36,878	$	35,545
Lease asset		3,332		3,265
Prepaid expenses		1,508		1,323
Deferred tax liability	$	41,718	$	40,133
Total net deferred tax liability	$	20,796	$	19,145

The following is a roll-forward of the Company’s total gross unrecognized tax benefits, not including interest and penalties, for the years ended December 31, 2020 and 2019 included in other liabilities, excluding current installments on the Company’s consolidated balance sheets:

	2020			2019
Balance at beginning of year	$	4,395		$	2,170
Additions for tax positions related to the current year		159			155
Additions for tax positions related to the prior years		16			27
Additions for tax positions related to acquired businesses		—			2,458
Reduction for tax positions related to the prior years		(841	)		(213	)
Effect of exchange rate changes		(507	)		(202	)
Balance at end of year	$	3,222		$	4,395

The Company recognizes accrued interest and penalties related to unrecognized tax benefits in the provision for income taxes in the Company’s consolidated financial statements. For the years ended December 31, 2020, 2019, and 2018 the Company had recognized approximately $4,195, $6,528, and $2,368 respectively in interest and penalties related to unrecognized tax benefits.

It is expected that the amount of unrecognized tax benefits will change and $2,032 of unrecognized tax benefits is expected to be released within the next twelve months due to expiration of statute of limitations.

The Company believes it is more likely than not that the deferred tax assets detailed in the table above will be realized in the normal course of business. It is the intent of the Company that undistributed earnings of foreign subsidiaries are permanently reinvested. The amount of undistributed earnings was $9,937 as of December 31, 2020. Upon distribution of earnings in the form of dividends or otherwise, the Company may still be subject to state income taxes and withholding taxes payable to the various foreign countries. Determination of the unrecognized deferred tax liability is not practical due to the complexities of a hypothetical calculation.

The Company is subject to U.S. federal income tax as well as to income tax in multiple state jurisdictions. Federal income tax returns of the Company are subject to IRS examination for the 2017 through 2019 tax years.  State income tax returns are subject to examination for the 2016 through 2019 tax years. The Company has other foreign income tax returns subject to examination.

The Florida Department of Revenue has completed its audit of the Company’s state income tax returns for the years ended December 31, 2012 through December 31, 2013 and December 31, 2015 through December 31, 2018. No adjustments have been proposed for these periods. The Company has also been notified by the Mississippi Department of Revenue of its intent to examine the Company’s state income tax returns for the years ended December 31, 2016 through December 31, 2018. The result of Mississippi’s audit is not determinable since the audit is at its preliminary stage.

On November 9, 2018, the Company completed the purchase of all of the outstanding shares of TyraTech, Inc., a loss corporation. The Company obtained approximately $3,971 of usable federal net operating losses through the acquisition. The Internal Revenue Code of 1986, as amended, imposes restrictions on the utilization of NOLs in the event of an “ownership change” of a corporation. During 2019, the Company completed the Section 382 analysis and determined that the utilization of the losses is subject to an annual limitation of $162, with an additional $890 of net operating losses available over the first five years after the ownership change.