Income Taxes

9 Months Ended

Jan. 31, 2023

Income Tax Disclosure [Abstract]

Income Taxes

Note 6 – Income Taxes

We are subject to taxation in the United States and various states jurisdictions in which we conduct our business.

Our tax provision for interim periods is determined using an estimate of our annual effective tax rate, adjusted for discrete items arising in that quarter. On a quarterly basis, we update our estimate of the annual effective tax rate, and if the estimated annual tax rate changes, we make a cumulative adjustment in that quarter.

The tax expense recorded for the third quarter of fiscal year 2023 differs from the U.S. federal statutory tax rate of 21% due primarily to the tax impact of state income taxes, stock-based compensation, non-deductible officers’ compensation and transportation fringe benefits.

For the three and nine months ended January 31, 2023, we recorded income tax expense of $2.1 million and $0.7 million, respectively, resulting in an effective tax rate of 82.6% and 44.9%, respectively.

We have no material uncertain tax positions as of January 31, 2023. It is our policy to recognize interest and penalties related to income tax matters in interest expense and other income (expense), net, respectively, in our unaudited condensed consolidated statements of operations and comprehensive income. There was no accrued interest or penalties associated with uncertain tax positions as of January 31, 2023.