Income Taxes (Notes)

9 Months Ended

Jun. 30, 2022

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company’s income tax expense for the three and nine months ended June 30, 2022 was $13.0 million and $41.4 million compared to $5.2 million and $21.5 million in the prior year periods. The effective tax rate was 24.7% and 24.4% for the three and nine months ended June 30, 2022 compared to 24.6% and 24.5% in the prior year periods. The effective tax rate for all periods includes an expense for state income taxes and nondeductible expenses and a benefit related to noncontrolling interests.

At June 30, 2022, the Company had deferred tax liabilities, net of deferred tax assets, of $24.5 million. The deferred tax assets were partially offset by a valuation allowance of $1.1 million, resulting in a net deferred tax liability of $25.6 million. At September 30, 2021, deferred tax liabilities, net of deferred tax assets, were $23.2 million. The deferred tax assets were partially offset by a valuation allowance of $1.2 million, resulting in a net deferred tax liability of $24.4 million. The valuation allowance for both periods was recorded because it is more likely than not that a portion of the Company's state deferred tax assets, primarily net operating loss (NOL) carryforwards, will not be realized because the Company is no longer operating in some states or the NOL carryforward periods are too brief to realize the related deferred tax asset. The Company will continue to evaluate both the positive and negative evidence in determining the need for a valuation allowance on its deferred tax assets. Any reversal of the valuation allowance in future periods will impact the effective tax rate.