INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2023

SCHEDULE OF PRETAX INCOME FROM CONTINUING OPERATIONS

Income tax expense (benefit) attributable to income from continuing operations was $16.4 million, $(24.2) million, and $25.0 million for the years ended December 31, 2023, 2022, and 2021, respectively, and differed from the amounts computed by applying the U.S. federal income tax rate of 21% to pretax income from continuing operations as a result of the following:


(in thousands, except percentage data)	2023				2022				2021
Federal income tax expense (benefit) at the statutory rate	21.0	%	$	58,296	(21.0)	%	$	(150,785)	(21.0)	%	$	(1,097)
State income taxes, net of federal tax expense	0.9	%	2,559		(1.6)	%	(11,495)		150.7	%	7,876
Executive compensation deduction limitation	0.9	%	2,587		1.0	%	7,358		578.1	%	30,213
Excess tax benefit related to share-based compensation	0.2	%	470		—	%	285		(36.5)	%	(1,909)
Nondeductible other expenses	0.6	%	1,798		—	%	14		4.3	%	225
Change in valuation allowance	(18.9)	%	(52,502)		18.2	%	130,462		(277.0)	%	(14,477)
Prior year true-ups	1.2	%	3,346		—	%	127		81.9	%	4,281
Other, net	—	%	(128)		—	%	(198)		(2.8)	%	(144)
Income tax expense (benefit) from continuing operations	5.9	%	$	16,426	(3.4)	%	$	(24,232)	477.7	%	$	24,968

SCHEDULE OF PROVISION FOR INCOME TAXES

The components of the provision for income taxes are as follows:


(in thousands)	December 31, 2023		December 31, 2022		December 31, 2021
Current income tax expense (benefit)
Federal	$	—	$	—	$	—
State	1,140		733		2
Total current income tax expense	1,140		733		2

Deferred expense
Federal	66,129		(143,598)		31,569
State	1,659		(11,829)		7,874
Total deferred tax expense (benefit)	67,788		(155,427)		39,443

Change in valuation allowance	(52,502)		130,462		(14,477)

Net deferred tax expense after valuation allowance (benefit)	15,286		(24,965)		24,966

Income tax provision (benefit)	$	16,426	$	(24,232)	$	24,968

SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2023 and 2022 are presented below:


(in thousands)	December 31, 2023		December 31, 2022
Deferred tax assets:
Tax credit carryforwards	$	517	$	386
Net operating loss carryforwards	144,081		48,703
Intangible assets	1,602		1,727
Stock compensation	3,898		2,133
Digital assets	—		52,535
Disallowed Interest	3,093		2,215
Bad debt reserve	9,957		10,039
Research and development costs	1,619		541
Accruals, reserves and other	286		239

Impairment loss	36,100		36,397
Capital losses	11,950		—
Gain on hedge instruments	3,798		—
Total gross deferred tax assets	216,901		154,915
Less valuation allowance	(77,960)		(130,462)
Net deferred tax assets	138,941		24,453

Deferred tax liabilities:
Unrealized gains	—		(2,494)

Property and equipment, net	(117,094)		(21,959)
Digital assets	(37,133)		—
Total gross deferred liabilities	(154,227)		(24,453)
Net deferred tax liability	$	(15,286)	$	—

SCHEDULE OF ATTRIBUTES AND CREDIT CARRYFORWARDS

The Company has the following attributes and credit carryforwards:


(in thousands)	Gross Amount		Expiring
Federal net operating loss carryforwards	$	3,314	2034-2035
Federal net operating loss carryforwards	651,476		Indefinite
State net operating loss carryforwards	117,286		Various
Interest expense carryforwards	14,189		Indefinite
Federal tax credit carryforwards	477		2040-2043
State tax credit carryforwards	40		Indefinite

SCHEDULE OF UNRECOGNIZED TAX BENEFITS ROLL FORWARD

A reconciliation of the beginning and ending amount of total unrecognized tax benefits for the tax years ended December 31, 2023 and 2022 is as follows:


(in thousands)	December 31, 2023		December 31, 2022		December 31, 2021
Balance, beginning of year	$	5,252	$	44	$	—
Increase (decrease) related to prior year tax positions	(31)		21		25
Increase related to current year tax positions	75		5,187		19



Balance, end of year	$	5,296	$	5,252	$	44