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INCOME TAXES
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
Income Tax Provision
The components of the income tax expense (benefit) are as follows (in thousands):
 Year Ended December 31,
 202420232022
Current income tax expense:  
Federal$587 $1,155 $— 
State940 1,022 353 
Current income tax expense1,527 2,177 353 
Deferred income tax expense (benefit):
Federal947 (3,383)98,772 
State1,846 (1,309)33,894 
Deferred income tax expense (benefit)2,793 (4,692)132,666 
Income tax expense (benefit)$4,320 $(2,515)$133,019 
A reconciliation of the income tax expense (benefit) to the amounts computed by applying the statutory federal income tax rate to income (loss) from continuing operations before income taxes is shown as follows (in thousands):
 Year Ended December 31,
 202420232022
Federal statutory income tax$(7,851)$(26,233)$(11,538)
State income taxes, net(502)(2,883)(729)
Excess tax deductions on non-cash compensation3,633 6,373 4,117 
Research and experimentation tax credit(1,500)(1,512)(2,906)
Nondeductible executive compensation3,245 2,174 2,692 
Increase (decrease) in valuation allowance5,045 17,087 139,374 
Remeasurement of state deferred tax776 73 305 
Expiration of state net operating loss carryforwards535 595 789 
Global intangible low-taxed income inclusion420 420 30 
Other, net519 1,391 885 
Income tax expense (benefit)$4,320 $(2,515)$133,019 
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,
 20242023
Deferred tax assets:  
Provision for accrued expenses$1,541 $1,168 
Leasing19,053 21,263 
Net operating loss carryforwards (a)
38,746 47,463 
Capitalized research and experimentation35,861 30,396 
Non-cash compensation expense23,953 28,126 
Property and equipment833 — 
Intangible assets1,882 11,379 
Interest22,422 21,295 
Equity Investment19,659 4,561 
Tax credits15,522 15,385 
Other71 95 
Total gross deferred tax assets179,543 181,131 
Less: valuation allowance (b)
(167,549)(162,504)
Total deferred tax assets, net of the valuation allowance11,994 18,627 
Deferred tax liabilities:
Leasing(16,379)(18,329)
Property and equipment— (1,563)
Other(499)(826)
Total gross deferred tax liabilities(16,878)(20,718)
Net deferred taxes$(4,884)$(2,091)
(a)At December 31, 2024, the Company had pre-tax consolidated federal net operating losses (“NOLs”) of $103.0 million. The federal NOLs no longer expire under the Tax Cuts and Jobs Act. 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 $428.6 million at December 31, 2024, a portion of which will expire at various times between 2025 and 2044.
(b)The valuation allowance is related to items for which it is “more likely than not” that the tax benefit will not be realized.
Deferred income taxes are presented in the accompanying consolidated balance sheets as follows (in thousands):
 December 31,
 20242023
Deferred income tax assets$— $— 
Deferred income tax liabilities(4,884)(2,091)
Net deferred taxes$(4,884)$(2,091)
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.
During 2024, the Company continued to maintain a full valuation allowance against its net deferred tax assets due to historical cumulative pre-tax losses and continued pre-tax losses. Management regularly reviews the deferred tax assets for recoverability based on historical taxable income, projected future taxable income, the expected timing of the reversals of existing taxable temporary differences, and tax planning strategies. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income. In determining the amount of the valuation allowance, the Company considered the scheduled reversal of deferred tax liabilities. The Company will maintain a full valuation allowance on net deferred tax assets until there is sufficient evidence to support the reversal of some or all of the allowance. Should there be a change in the valuation allowance in the future, the income tax provision would increase or decrease in the period in which the allowance is changed. At December 31, 2024 and 2023, the Company recorded a full valuation allowance of $167.5 million and $162.5 million, respectively.
A reconciliation of the beginning and ending balances of the deferred tax valuation allowance is as follows (in thousands):
 Year Ended December 31,
 202420232022
Balance, beginning of the period$162,504 $145,401 $6,039 
Charges to earnings5,045 17,103 139,362 
Balance, end of the period$167,549 $162,504 $145,401 
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,
 20242023
Balance, beginning of the period$3,424 $3,282 
Additions based on tax positions of the current period225 227 
Additions (subtractions) based on tax positions of the prior period72 (85)
Balance, end of the period$3,721 $3,424 
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 of an immaterial amount has been recognized for the tax years ended December 31, 2023 and 2022. For the year ended December 31, 2024 interest is not currently required to be recorded, as there have been no tax attributes included in income tax returns filed for those tax periods to require consideration of interest expense.
As of December 31, 2024 and 2023, the accrual for unrecognized tax benefits, including interest, was $3.7 million and $3.4 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, 2024, the Company is subject to a federal income tax examination for the tax years 2016 through 2023. In addition, the Company is subject to state and local tax examinations for the tax years 2019 through 2023.