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INCOME TAXES
 12 Months Ended
Dec. 31, 2021
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
Income Tax Provision
The components of the income tax benefit are as follows (in thousands):
 Year Ended December 31,
 202120202019
Current income tax expense (benefit):  
Federal$128 $(10,705)$201 
State262 372 (125)
Current income tax expense (benefit)390 (10,333)76 
Deferred income tax provision (benefit):
Federal9,912 (7,495)(10,857)
State996 (2,133)2,302 
Deferred income tax provision (benefit)10,908 (9,628)(8,555)
Income tax expense (benefit)$11,298 $(19,961)$(8,479)
A reconciliation of the income tax benefit to the amounts computed by applying the statutory federal income tax rate to income (loss) from continuing operations before income taxes is shown as follows (in thousands):
 Year Ended December 31,
 202120202019
Federal statutory income tax$17,731 $(8,931)$6,506 
State income taxes, net1,269 (3,551)(1,832)
Excess tax deductions on non-cash compensation(9,401)(2,033)(13,971)
Impact of the Coronavirus Aid, Relief, and Economic Security Act— (6,104)— 
Research and experimentation tax credit(3,207)(3,800)(5,794)
Impact of certain state legislation, net— — 3,932 
Nondeductible executive compensation3,058 1,778 988 
Increase (decrease) in valuation allowance595 2,100 954 
Uncertain tax positions435 458 922 
Nondeductible meals & entertainment239 99 428 
Other, net579 23 (612)
Income tax expense (benefit)$11,298 $(19,961)$(8,479)
Deferred Income Taxes
The tax effects of cumulative temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are as follows (in thousands):
 December 31,
 20212020
Deferred tax assets:  
Provision for accrued expenses$5,405 $4,907 
Leasing27,419 24,864 
Net operating loss carryforwards (a)
66,977 56,190 
Non-cash compensation expense26,756 20,746 
Intangible assets15,222 12,684 
Interest limitation8,036 4,059 
Contingent liabilities— 4,507 
Tax credits15,848 13,656 
Other1,079 3,605 
Total gross deferred tax assets166,742 145,218 
Less: valuation allowance (b)
(6,039)(5,802)
Total deferred tax assets, net of the valuation allowance160,703 139,416 
Deferred tax liabilities:
Leasing(24,590)(21,632)
Property and equipment(8,156)(5,015)
Equity investment(25,608)— 
Other(444)(653)
Total gross deferred tax liabilities(58,798)(27,300)
Net deferred taxes$101,905 $112,116 
(a)At December 31, 2021, the Company had pre-tax consolidated federal net operating losses ("NOLs") of $220.1 million. The federal NOLs no longer expire under the new TCJA. The Company's NOLs will be available to offset taxable income subject to the Internal Revenue Code Section 382 annual limitation. In addition, the Company has state NOLs of approximately $542.7 million at December 31, 2021 that will expire at various times between 2022 and 2041.
(b)The valuation allowance is related to items for which it is "more likely than not" that the tax benefit will not be realized.
Deferred income taxes are presented in the accompanying consolidated balance sheets as follows (in thousands):
 December 31,
 20212020
Deferred income tax assets$87,581 $96,224 
Non-current assets of discontinued operations16,589 15,892 
Deferred income tax liabilities(2,265)— 
Net deferred taxes$101,905 $112,116 
Valuation Allowance
A valuation allowance is provided on deferred tax assets if it is determined that it is "more likely than not" that the deferred tax asset will not be realized. As of each reporting date, management considers both positive and negative evidence regarding the likelihood of future realization of the deferred tax assets.
At December 31, 2021, 2020 and 2019, the Company recorded a partial valuation allowance of $6.0 million, $5.8 million and $4.1 million, respectively, primarily related to state net operating losses, which the Company does not expect to be able to utilize prior to expiration.
A reconciliation of the beginning and ending balances of the deferred tax valuation allowance is as follows (in thousands):
 Year Ended December 31,
 202120202019
Balance, beginning of the period$5,802 $4,102 $2,229 
Charges to earnings237 1,700 1,873 
Balance, end of the period$6,039 $5,802 $4,102 
Unrecognized Tax Benefits
A reconciliation of the beginning and ending amounts of unrecognized tax benefits, excluding interest and penalties, is as follows (in thousands):
 Year Ended December 31,
 20212020
Balance, beginning of the period$2,613 $1,996 
Additions based on tax positions of the current period435 570 
Additions (subtractions) based on tax positions of the prior period(134)47 
Balance, end of the period$2,914 $2,613 
Interest and, if applicable, penalties are recognized related to unrecognized tax benefits in income tax expense. Interest and penalties on unrecognized tax benefits included in income tax expense for each of the years ended December 31, 2021, 2020 and 2019 is immaterial.
As of December 31, 2021 and 2020, the accrual for unrecognized tax benefits, including interest, was $2.9 million and $2.6 million, respectively, which would benefit the effective tax rate if recognized.
Tax Audits
LendingTree is subject to audits by federal, state and local authorities in the area of income tax. These audits include questioning the timing and the amount of deductions and the allocation of income among various tax jurisdictions. Income taxes payable include amounts considered sufficient to pay assessments that may result from examination of prior year returns; however, any amounts paid upon resolution of issues raised may differ from the amount provided. Differences between the reserves for tax contingencies and the amounts owed by the Company are recorded in the period they become known. As of December 31, 2021, the Company is subject to a federal income tax examination for the tax years 2014 through 2020. In addition, the Company is subject to state and local tax examinations for the tax years 2017 through 2021.