Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Schedule of components of income tax expense

The components of income tax expense for the years ended December 31, 2017, 2018 and 2019 were as follows (in thousands):



	2017			2018			2019

Current income tax expense:
Federal	$	11,989		$	8,034		$	5,803
State	1,998			2,170			1,425
	13,987			10,204			7,228
Deferred tax expense:
Federal	(2,810		)	(776		)	(1,766		)
State	316			(141		)	(275		)
	(2,494		)	(917		)	(2,041		)
Income Tax Expense	$	11,493		$	9,287		$	5,187

Schedule of tax effects of principal temporary differences

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



	2018			2019

Deferred tax assets
Operating lease liability	$	—		$	2,912
Allowance for doubtful accounts	1,637			1,528
Restricted stock	1,625			1,232
Accrued vacation and severance	571			660
Investment	35			304
Other	32			232
Deferred rent	71			—
Stock option compensation expense	—			1
Total deferred tax assets	3,971			6,869
Deferred tax liabilities
Income tax deductible capitalized software development costs	(4,701		)	(3,330		)
Operating lease asset	—			(2,882		)
Property and equipment	(1,484		)	(1,670		)
Prepaid expenses	(1,259		)	(1,607		)
Goodwill and intangibles	(1,891		)	(771		)
Total deferred tax liabilities	(9,335		)	(10,260		)
Deferred tax liabilities, net	$	(5,364	)	$	(3,391	)

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):



	2017					2018					2019
	Amount			%		Amount			%		Amount			%

Tax expense at statutory rate	$	11,415		35.00	%	$	7,320		21.00	%	$	3,192		21.00	%
State taxes, net	1,626			4.98	%	1,575			4.51	%	852			5.60	%
Permanent differences	2,060			6.31	%	433			1.24	%	244			1.61	%
Change in statutory rate	(3,741		)	(11.47	)%	—			—	%	—			—	%
Equity-based compensation benefits	—			—	%	(126		)	(0.36	)%	371			2.44	%
Post-employment benefits	—			—	%	—			—	%	345			2.27	%
Uncertain tax position	—			—	%	154			0.44	%	93			0.61	%
Valuation allowance on capital loss	—			—	%	—			—	%	213			1.40	%
Other	133			0.42	%	(69		)	(0.19	)%	(123		)	(0.80	)%
	$	11,493		35.24	%	$	9,287		26.64	%	$	5,187		34.13	%