Income Taxes

6 Months Ended

Apr. 30, 2024

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

We recorded income tax provisions of $168.2 million and $110.4 million for the three months ended April 30, 2024 and 2023, respectively. The effective tax rate was 25.9% for the three months ended April 30, 2024, compared to 25.6% for the three months ended April 30, 2023. We recorded income tax provisions of $239.8 million and $172.6 million for the six months ended April 30, 2024 and 2023, respectively. The effective tax rate was 25.0% for the six months ended April 30, 2024, compared to 25.2% for the six months ended April 30, 2023. The income tax provisions for all periods included the provision for state income taxes, interest accrued on anticipated tax assessments, excess tax benefits related to stock-based compensation, federal energy efficient home credits and other permanent differences.

We are subject to state tax in the jurisdictions in which we operate. We estimate our state tax liability based upon the individual taxing authorities’ regulations, estimates of income by taxing jurisdiction, and our ability to utilize certain tax-saving strategies. Based on our estimate of the allocation of income or loss among the various taxing jurisdictions and changes in tax regulations and their impact on our tax strategies, we estimate that our state income tax rate for the full fiscal year 2024 will be approximately 6.1%. Our state income tax rate for the full fiscal year 2023 was 6.2%.

At April 30, 2024, we had $12.0 million of gross unrecognized tax benefits, including interest and penalties. If these unrecognized tax benefits were to reverse in the future, they would have a beneficial impact on our effective tax rate at that time. During the next 12 months, it is reasonably possible that our unrecognized tax benefits will change, but we are not able to provide a range of such change. The possible changes would be principally due to the expiration of tax statutes, settlements with taxing jurisdictions, increases due to new tax positions taken, and the accrual of estimated interest and penalties.