Note 14: Income Taxes

3 Months Ended

Mar. 31, 2019

Notes

Note 14: Income Taxes

NOTE 14: INCOME TAXES

Reconciliations of the Company’s effective tax rates to the statutory corporate tax rates were as follows:

	Three Months Ended March 31,
	2019	2018
Tax at statutory rate	21.0%	21.0%
Nontaxable interest and dividends	(0.5)	(1.1)
Tax credits	(4.5)	(4.5)
State taxes	1.4	1.2
Other	1.1	(0.2)
	18.5%	16.4%

The Tax Act was signed into law on December 22, 2017, making several changes to U. S. corporate income tax laws, including reducing the corporate Federal income tax rate from 35% to 21% effective for tax years beginning on or after January 1, 2018.  U. S. GAAP requires that the impact of the provisions of the Tax Act be accounted for in the period of enactment. The Company recognized the income tax effects of the Tax Act in its 2017 financial statements. The Tax Act is complex and required significant detailed analysis.  During the preparation of the Company’s 2017 income tax returns in 2018, no additional adjustments related to enactment of the Tax Act were identified. 

The Company and its consolidated subsidiaries have not been audited recently by the Internal Revenue Service (IRS) and, as such, tax years through December 31, 2005, have been closed without audit.  The Company, through one of its subsidiaries, is a partner in two partnerships which have been under Internal Revenue Service examination for 2006 and 2007.  As a result, the Company’s 2006 and subsequent tax years remain open for examination.  The examinations of these partnerships advanced during 2016, 2017, and 2018.  One of the partnerships has advanced to Tax Court and has entered a Motion for Entry of Decision with an agreed upon settlement.  The other partnership examination was recently completed by the IRS with no change impacting the Company’s tax positions.  The Company does not currently expect significant adjustments to its financial statements from the partnership matter at the Tax Court.

The Company is currently under State of Missouri income and franchise tax examinations for its 2014 through 2015 tax years.  The Company does not currently expect significant adjustments to its financial statements from this state examination.