Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Schedule of components of income tax expense

The components of income tax expense for the years ended December 31, 2016, 2017 and 2018 were as follows (in thousands):



	2016			2017			2018

Current income tax expense:
Federal	$	13,518		$	11,989		$	8,034
State	1,877			1,998			2,170
	15,395			13,987			10,204
Deferred tax expense:
Federal	(424		)	(2,810		)	(776		)
State	(31		)	316			(141		)
	(455		)	(2,494		)	(917		)
Income Tax Expense	$	14,940		$	11,493		$	9,287

Schedule of tax effects of principal temporary differences

The tax effects of principal temporary differences are as follows (in thousands):



	2017			2018

Deferred tax assets
Stock option compensation expense	$	415		$	—
Allowance for doubtful accounts	1,569			1,637
Accrued vacation and severance	679			571
Deferred rent	67			71
Restricted stock	922			1,625
Investment	—			35
Other	—			32
Total deferred tax assets	3,652			3,971
Deferred tax liabilities
Income tax deductible capitalized software development costs	(6,066		)	(4,701		)
Goodwill	(1,284		)	(1,891		)
Property and equipment	(1,489		)	(1,484		)
Prepaid expenses	(1,017		)	(1,259		)
Investment	(77		)	—
Total deferred tax liabilities	(9,933		)	(9,335		)
Deferred tax liabilities, net	$	(6,281	)	$	(5,364	)

Schedule of difference of income tax expense from the United States Federal income tax rates

Income tax expense differs from the amount of tax determined by applying the United States Federal income tax rates to pretax income and loss due to the application of state apportionment laws, permanent tax differences, and the impact of the change in the federal statutory rate as follows (in thousands):



	2016					2017					2018
	Amount			%		Amount			%		Amount			%

Tax expense at statutory rate	$	13,683		35.00	%	$	11,415		35.00	%	$	7,320		21.00	%
State taxes, net	1,278			3.27	%	1,626			4.98	%	1,575			4.51	%
Permanent differences	221			0.56	%	2,060			6.31	%	433			1.24	%
Change in statutory rate	—			—	%	(3,741		)	(11.47	)%	—			—	%
Other	(242		)	(0.62	)%	133			0.42	%	(41		)	(0.11	)%
	$	14,940		38.21	%	$	11,493		35.24	%	$	9,287		26.64	%