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Note 7 - Other Assets - Summary of Other Assets (Details) - USD ($)
$ in Thousands
Dec. 31, 2020
Dec. 31, 2019
Capitalized selling and marketing costs, net [1] $ 5,895 $ 7,148
Prepaid income taxes [2] 27,866 1,032
Insurance receivable [3] 4,816 10,900
Warranty insurance receivable [4] 2,480 1,852
Prepaid expenses 6,331 2,729
Right-of-use lease assets 2,997 1,988
Other 318 231
Other assets $ 50,703 $ 25,880
[1] Capitalized selling and marketing costs includes costs incurred for tangible assets directly used in the sales process such as our sales offices, design studios and model furnishings, and also includes model landscaping costs, which were $2.2 million and $2.6 million as of December 31, 2020 and 2019, respectively. The Company depreciated $6.5 million and $8.7 million, of capitalized selling and marketing costs to selling and marketing expenses during the years ended December 31, 2020 and 2019, respectively.
[2] The amount at December 31, 2020 includes approximately $27.4 million of expected federal income tax refunds due to the recent enactment of the CARES Act signed into law on March 27, 2020 which allows net operating losses generated from 2018 – 2020 to be carried back five years.
[3] The Company recorded insurance receivables of $10.9 million in connection with $10.9 million of litigation reserves recorded as of December 31, 2019. During 2020, $4.7 million was paid by our insurance carrier directly to claimants related to two claims, and the Company reduced its insurance receivable estimate by $0.2 million for one claim and adjusted the incurred but not reported ("IBNR") litigation reserve by $1.2 million, resulting in an insurance receivable balance of $4.8 million at December 31, 2020 with a corresponding decrease recorded within litigation reserves and $0.2 million charged to cost of sales. For more information, please refer to Note 8.
[4] The Company adjusted its warranty insurance receivable upward by $1.2 million during 2020 to true-up the receivable to its estimate of qualifying reimbursable expenditures which resulted in pretax income of $0.3 million for the year ended December 31, 2020. The Company adjusted its warranty insurance receivable upward by $1.4 million during 2019 to true-up the receivable to its estimate of qualifying reimbursable expenditures which resulted in pretax income of the same amount for the year ended December 31, 2019.