Note 5 - Income Taxes

12 Months Ended

Dec. 31, 2022

Notes to Financial Statements

Income Tax Disclosure [Text Block]

5. Income Taxes

The components of the income taxes expense consisted of the following:

(In thousands)	2022		2021		2020
Current:
Federal	$	18,025	$	18,872	$	21,312
State		3,914		3,367		3,498
Total current		21,939		22,239		24,810
Deferred:
Federal		9,795		3,462		(1,557	)
State		2,083		603		633
Total deferred		11,878		4,065		(924	)
Total expense	$	33,817	$	26,304	$	23,886

The federal statutory income tax rate is reconciled to the effective income tax rate as follows:

	2022			2021			2020
Federal statutory income tax rate		21	%		21	%		21	%
Increase in taxes arising from state income taxes, net of federal income tax benefit		3			3			4
Per diem and other non-deductible expenses		-			-			1
Federal tax credits		-			-			(1	)
Other, net		(1	)		-			1
Effective tax rate		23	%		24	%		26	%

As of December 31, the net deferred tax liability consisted of the following:

(In thousands)	2022		2021
Deferred tax assets:
Reserves and accrued liabilities	$	13,244	$	11,975
Other		1,597		1,597
		14,841		13,572
Deferred tax liabilities:
Depreciation		148,285		135,306
Prepaid expenses		3,597		3,429
		151,882		138,735
Net deferred tax liability	$	137,041	$	125,163

We have not provided a valuation allowance against deferred tax assets at December 31, 2022 or 2021. We believe the deferred tax assets will be realized principally through future reversals of existing taxable temporary differences (deferred tax liabilities) and future taxable income.

Our reserves for unrecognized tax benefits were $438,000 as of December 31, 2022 and $4.1 million as of December 31, 2021. The $3.7 million decrease in the amount reserved relates to resolution of an IRS audit in 2022. If recognized, $346,000 of the unrecognized tax benefits as of December 31, 2022 would favorably impact our effective tax rate. Potential interest and penalties related to unrecognized tax benefits of $10,000 were recognized in our financial statements in each of 2022 and 2021. The federal statute of limitations remains open for 2019 and forward. We file tax returns in numerous state jurisdictions with varying statutes of limitations.