Income Taxes

12 Months Ended

Apr. 30, 2022

Income Tax Disclosure [Abstract]

Income Taxes

INCOME TAXES

Income tax expense attributable to earnings consisted of the following components:

	Years ended April 30,
	2022		2021		2020
Current tax expense:
Federal	$	4,382	$	73,950	22,182
State	13,835		16,397		6,210
	18,217		90,347		28,392
Deferred tax expense	82,721		4,123		49,810
Total income tax expense	$	100,938	$	94,470	78,202

The tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and deferred tax liabilities were as follows: 

	As of April 30,
	2022		2021
Deferred tax assets:
Accrued liabilities and reserves	$	30,932	$	29,583
Workers compensation	9,922		9,000
Operating and finance lease obligations	46,693		9,186
Asset retirement obligations	7,361		6,294
Deferred compensation	3,540		4,221
Equity compensation	9,567		9,131
State net operating losses & tax credits	4,021		928
Other	3,548		3,068
Total gross deferred tax assets	115,584		71,411
Less valuation allowance	250		—
Total net deferred tax assets	115,334		71,411
Deferred tax liabilities:
Property and equipment depreciation	(597,740)		(484,065)
Goodwill	(34,869)		(27,047)
Other	(3,197)		(20)
Total gross deferred tax liabilities	(635,806)		(511,132)
Net deferred tax liability	$	(520,472)	(439,721)

At April 30, 2022, the Company had net operating loss carryforwards for state income tax purposes of approximately $130,040, which are available to offset future state taxable income. The state net operating loss carryforwards begin to expire in 2029. In addition, the Company had state tax credit carryforwards of approximately $1,525, which begin to expire in 2026.

The valuation allowance for state net operating loss and state tax credit deferred tax assets as of April 30, 2022 and 2021 was $250 and $0, respectively. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected taxable income, and tax planning strategies in making this assessment.

Total reported tax expense applicable to the Company’s continuing operations varies from the tax that would have resulted from applying the statutory U.S. federal income tax rates to income before income taxes.

	Years ended April 30,
	2022		2021		2020
Income taxes at the statutory rates	21.0	%	21.0	%	21.0	%
Federal tax credits	(1.8)	%	(1.5)	%	(1.9)	%
State income taxes, net of federal tax benefit	3.8	%	3.5	%	4.0	%
Impact of phased-in state law changes, net of federal benefit	(0.8)	%	—	%	(0.2)	%
ASU 2016-09 benefit (stock-based compensation)	(1.0)	%	(0.6)	%	(0.5)	%
Other	1.7	%	0.8	%	0.5	%
	22.9	%	23.2	%	22.9	%

The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company had a total of $10,259 and $9,316 in gross unrecognized tax benefits at April 30, 2022 and 2021, respectively, which is recorded in other long-term liabilities in the consolidated balance sheet. Of this amount, $8,105 represents the amount of unrecognized tax benefits that, if recognized, would impact our effective tax rate. Unrecognized tax benefits increased $943 during the twelve months ended April 30, 2022, due primarily to the increase associated with income tax filing positions for the current year exceeding the decrease related to the expiration of certain statute of limitations. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

	2022		2021
Beginning balance	$	9,316	$	8,907
Additions based on tax positions related to current year	2,953		2,356
Reductions due to lapse of applicable statute of limitations	(2,010)		(1,947)
Ending balance	$	10,259	$	9,316

The total net amount of accrued interest and penalties for such unrecognized tax benefits was $371 and $370 at April 30, 2022 and 2021, respectively, and is included in other long-term liabilities. Net interest and penalties included in income tax expense for the twelve month periods ended April 30, 2022 and 2021 was an increase in tax expense of $1 and $16, respectively.

A number of years may elapse before an uncertain tax position is audited and ultimately settled. It is difficult to predict the ultimate outcome or the timing of resolution for uncertain tax positions. It is reasonably possible that the amount of unrecognized tax benefits could significantly increase or decrease within the next twelve months. These changes could result from the expiration of the statute of limitations, examinations or other unforeseen circumstances. The Company has no ongoing federal or state income tax examinations.

At this time, the Company’s best estimate of the reasonably possible change in the amount of the gross unrecognized tax benefits is a decrease of $2,100 during the next twelve months mainly due to the expiration of certain statute of limitations. The federal statute of limitations remains open for the tax years 2018 and forward. Tax years 2012 and forward are subject to audit by state tax authorities depending on open statute of limitations waivers and the tax code of each state.