Income Taxes

9 Months Ended

Sep. 30, 2020

Income Tax Disclosure [Abstract]

Income Taxes

INCOME TAXES

A reconciliation of the U.S. federal statutory income tax rate to our effective income tax rate is as follows:

	For the Three Months Ended  September 30,				For the Nine Months Ended  September 30,
	2020		2019		2020		2019
U.S. federal statutory income tax rate	21.0	%	21.0	%	21.0	%	21.0	%
State income taxes	2.9	%	3.5	%	3.0	%	3.1	%
Excess tax benefits from stock-based compensation plans	—	%	—	%	-0.8	%	-1.2	%
Other	0.1	%	—	%	0.4	%	—	%
Effective income tax rate	24.0	%	24.5	%	23.6	%	22.9	%

State income taxes

The decrease in our state income tax rate for the three months ended September 30, 2020, compared to the same period in 2019, was primarily due to the impact of increasing our effective state tax rate estimate in 2019 as a result of higher income tax rates in certain state tax jurisdictions.

Excess tax benefits from stock-based compensation plans

During the first quarter of each year, we receive a tax benefit upon the vesting of restricted stock and the conversion of restricted stock units to common stock based on the fair value of the shares. The amount by which this tax benefit exceeds the grant-date fair value that was recognized as stock-based compensation expense is referred to as an excess tax benefit. Excess tax benefits are recognized in provision for income taxes and reduce our effective income tax rate. The impact of excess tax benefits on our effective income tax rate decreased in magnitude from 2019 to 2020 primarily due to a decrease in the number of restricted stock units that were converted to common stock due to the timing of long-term stock award grants.

Other

Other items impacting our effective income tax rate in 2020 primarily consist of non-deductible executive compensation expenses. The impact on our effective income tax rate for the nine months ended September 30, 2020, increased in magnitude from 2019 to 2020 primarily due to the decrease in pre-tax income.