Income Taxes (Tables)

12 Months Ended

May 31, 2021

Earnings before income taxes for the three fiscal years ended May 31 included the following components:

(in thousands)	2021		2020		2019
U.S. based operations	$	897,601	$	99,493	$	173,200
Non – U.S. based operations		20,116		11,293		33,256
Earnings before income taxes		917,717		110,786		206,456
Less: Net earnings attributable to noncontrolling interests*		17,655		5,648		9,818
Earnings before income taxes attributable to controlling interest	$	900,062	$	105,138	$	196,638

Net earnings attributable to noncontrolling interests are not taxable to Worthington.

Significant components of income tax expense (benefit) for the fiscal years ended May 31 were as follows:

A reconciliation of the federal statutory corporate income tax rate to total tax provision follows:

	2021			2020			2019
Federal statutory corporate income tax rate		21.0	%		21.0	%		21.0	%
State and local income taxes, net of federal tax benefit		0.8			2.4			2.1
Non-U.S. income taxes at other than federal statutory rate		(0.3	)		3.1			0.2
Excess benefit related to share-based payment awards		(0.5	)		(1.2	)		(1.4	)
Nondeductible executive compensation		0.6			1.1			0.6
Oil & Gas capital stock loss		(1.5	)		-			-
Other		(0.5	)		(1.3	)		(0.5	)
Effective tax rate attributable to controlling interest		19.6	%		25.1	%		22.0	%

A tabular reconciliation of unrecognized tax benefits follows:

(In thousands)
Balance at May 31, 2020	$	1,718
Decreases - tax positions taken in prior years		(1,445	)
Increases - current tax positions		3,730
Lapse of statutes of limitations		(167	)
Balance at May 31, 2021	$	3,836

The components of our deferred tax assets and liabilities as of May 31 were as follows:

(in thousands)	2021			2020
Deferred tax assets
Accounts receivable	$	1,244		$	1,246
Inventories		4,946			5,554
Accrued expenses		24,714			21,214
Net operating loss carry forwards		9,907			11,732
Stock-based compensation		6,076			6,931
Derivative contracts		-			1,920
Operating lease - ROU liability		7,642			7,294
Other		2,309			3,549
Total deferred tax assets		56,838			59,440
Valuation allowance for deferred tax assets		(9,124	)		(11,178	)
Net deferred tax assets		47,714			48,262
Deferred tax liabilities
Property, plant and equipment		(111,789	)		(95,553	)
Investment in affiliated companies, principally due to undistributed earnings		(24,034	)		(15,884	)
Operating lease - ROU asset		(7,102	)		(6,241	)
Derivative contracts		(15,343	)		-
Other		(3,197	)		(2,526	)
Total deferred tax liability		(161,465	)		(120,204	)
Net deferred tax liability	$	(113,751	)	$	(71,942	)