XML 33 R20.htm IDEA: XBRL DOCUMENT v3.22.0.1
Income Taxes
 12 Months Ended
Dec. 31, 2021
Income Tax Disclosure [Abstract]  
Income Taxes INCOME TAXES
The Company's deferred income taxes reflect the value of its net operating loss carryforwards and the tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their amounts used for income tax calculations.
At December 31, 2021, the Company had cumulative net operating loss carryforwards (“NOL CFs”) for federal income tax purposes of approximately $413.9 million, which do not expire but whose use may be limited to 80% of taxable income in any given year. The deferred tax asset balance includes $4.7 million net of a $0.3 million valuation allowance related to state NOL CFs, which have remaining lives ranging from one to twenty years. These NOL CFs are attributable to excess tax deductions related primarily to the accelerated tax depreciation of fixed assets, the timing of amortization related to Amazon warrants and cash contributions for its benefit plans. At December 31, 2021 and 2020, the Company determined that, based upon projections of taxable income, it was more likely than not that the Federal NOL CF’s will be utilized, accordingly, no allowance against these deferred tax assets was recorded. The Company had alternative minimum tax credits of $3.1 million which were recovered in 2020.
The significant components of the deferred income tax assets and liabilities as of December 31, 2021 and 2020 are as follows (in thousands):
 December 31
 20212020
Deferred tax assets:
Net operating loss carryforward and federal credits$93,294 $71,762 
Operating lease obligation13,266 14,472 
Warrants32,075 33,940 
Post-retirement employee benefits— 7,140 
Employee benefits other than post-retirement6,919 8,545 
Inventory reserve2,714 2,288 
Deferred revenue10,918 12,608 
Other8,789 9,366 
Deferred tax assets167,975 160,121 
Deferred tax liabilities:
Accelerated depreciation(327,321)(257,765)
Post-retirement employee benefits(1,330)— 
Partnership items(6,014)(6,044)
Operating lease assets(13,029)(14,264)
Goodwill and intangible assets(14,553)(9,877)
State taxes(19,158)(11,143)
Valuation allowance against deferred tax assets(3,861)(2,293)
Deferred tax liabilities(385,266)(301,386)
Net deferred tax (liability)$(217,291)$(141,265)
The following summarizes the Company’s income tax provisions (benefits) (in thousands):
 Years Ended December 31
 202120202019
Current taxes:
Federal$— $(1,332)$1,332 
Foreign— — 1 
State2,402 1,235 138 
Deferred taxes:
Federal65,027 19,701 14,155 
Foreign— — — 
State4,795 (1,209)(3,677)
Change in federal statutory tax rates— — — 
Total deferred tax expense69,822 18,492 10,478 
Total income tax expense (benefit) from continuing operations$72,224 $16,314 $11,589 
Income tax expense (benefit) from discontinued operations$722 $2,081 $360 
The reconciliation of income tax from continuing operations computed at the U.S. statutory federal income tax rates to effective income tax rates is as follows:
 Years Ended December 31
 202120202019
Statutory federal tax rate21.0 %21.0 %21.0 %
Foreign income taxes— %— %— %
State income taxes, net of federal tax benefit1.8 %5.1 %1.4 %
Tax effect of non-deductible warrant expense— %16.6 %(2.9)%
Tax effect of other non-deductible expenses0.5 %3.2 %1.7 %
Change to state statutory tax rates— %(5.4)%(5.4)%
Other0.7 %(1.1)%0.4 %
Effective income tax rate24.0 %39.4 %16.2 %
The income tax deductibility of the warrant expense is less than the expense required by GAAP because for tax purposes, the warrants are valued at a different time and under a different valuation method.
The reconciliation of income tax from discontinued operations computed at the U.S. statutory federal income tax rates to effective income tax rates is as follows:
 Years Ended December 31
 202120202019
Statutory federal tax rate21.0 %21.0 %21.0 %
State income taxes, net of federal tax benefit1.8 %1.8 %1.8 %
Change in federal statutory tax rates— %— %— %
Effective income tax rate22.8 %22.8 %22.8 %
The Company files income tax returns in the U.S. Federal jurisdiction and various international, state and local jurisdictions. The returns may be subject to audit by the Internal Revenue Service (“IRS”) and other jurisdictional authorities. International returns consist primarily of disclosure returns where the Company is covered by the sourcing rules of U.S. international treaties. The Company recognizes the impact of an uncertain income tax position in the financial statements if that position is more likely than not of being sustained on audit, based on the technical merits of the position. At December 31, 2021, 2020 and 2019, the Company's unrecognized tax benefits were $0.0 million, $0.0 million and $0.0 million respectively. Accrued interest and penalties on tax positions are recorded as a component of interest expense. Interest and penalties expense was immaterial for 2021, 2020 and 2019.
The Company began to file, effective in 2008, federal tax returns under a common parent of the consolidated group that includes ABX and all the wholly-owned subsidiaries. The returns for 2020, 2019 and 2018 related to the consolidated group remain open to examination. The consolidated federal tax returns prior to 2018 remain open to federal examination only to the extent of net operating loss carryforwards carried over from or utilized in those years. Pemco and Omni filed returns on their own behalf prior to their acquisition by the Company. State and local returns filed for 2005 through 2020 are generally also open to examination by their respective jurisdictions, either in full or limited to net operating losses. The Company files tax returns with the Republic of Ireland for its leasing operations based in Ireland.