Note 8 - Income Taxes

3 Months Ended

Dec. 31, 2020

Notes to Financial Statements

Income Tax Disclosure [Text Block]

Note 8 - Income Taxes

For the three months ended December 31, 2020, the Company recorded a provision for income taxes of $22,180,000 on pretax income of $81,450,000.   The income tax provision consisted of a tax provision of $63,000 on income from operations, a tax benefit of $84,000 for the dividends received deduction and other permanent book and tax differences, a tax provision of $22,360,000 on the unrealized gains on marketable securities and a tax benefit of $159,000 related to restating state deferred taxes to the current state rate. The overall effective tax rate for the three months ended December 31, 2020 was 27%, after including the taxes on the unrealized gains on marketable securities.

For the three months ended December 31, 2019, the Company recorded a provision for income taxes of $5,280,000 on pretax income of $19,490,000.   This was the net result of applying the 19% effective tax rate that had been anticipated for fiscal 2020 to the pretax loss, before the unrealized gains on marketable securities, for the three months ended December 31, 2019.  The 19% effective tax rate was less than the statutory rate primarily due to the dividends received deduction and state tax benefits.  In addition, the Company recorded taxes on its unrealized gains on marketable securities of $19,531,000 during the three months ended December 31, 2019.  The overall effective tax rate for the three months ended December 31, 2019 was 27%, after including the taxes on the unrealized gains on marketable securities.

The Company files consolidated federal income tax returns in the United States and with various state jurisdictions and is no longer subject to examinations for fiscal years before fiscal 2017 with regard to federal income taxes and fiscal 2016 for state income taxes.