Income Taxes

12 Months Ended

Dec. 31, 2024

Income Tax Disclosure [Abstract]

Income Taxes

INCOME TAXES

The provision for income taxes is comprised of the following (in millions):

	Years ended December 31,
	2024		2023		2022
Current:
Federal	$	69.4	$	66.2	$	55.5
State and local	18.8		22.6		17.3
	88.2		88.8		72.8
Deferred:
Federal	1.3		0.5		5.6
State and local	0.3		0.1		1.5
	1.6		0.6		7.1
Total tax expense	$	89.8	$	89.4	$	79.9

The reconciliation between our effective tax rate on net income and the federal statutory rate is as follows (in millions):

	Years ended December 31,
	2024				2023				2022
Income tax at federal statutory rate	$	72.7	21.0	%	$	70.0	21.0	%	$	63.7	21.0	%
Stock compensation	(1.1)		(0.3)	%	(0.5)		(0.2)	%	0.3		0.1	%
Other permanent items	2.3		0.7	%	1.8		0.5	%	1.3		0.4	%
Change in valuation allowance	—		—	%	—		—	%	(0.1)		(0.1)	%
Change in uncertain tax positions	0.5		0.1	%	0.2		0.1	%	(0.5)		(0.1)	%
State and local income taxes, net of federal benefit	15.4		4.4	%	17.9		5.4	%	15.2		5.0	%
Total tax expense	$	89.8	25.9	%	$	89.4	26.8	%	$	79.9	26.3	%

Components of the net deferred tax asset or liability are as follows (in millions):

	As of December 31,
	2024		2023
Deferred Tax Assets
Long-term
Accrued liabilities and allowances	$	13.0	$	13.2
Allowance for doubtful accounts	1.9		1.5
Inventories	1.5		1.1
Property and equipment	0.3		0.4
Intangibles	10.6		9.4
Net operating loss carryforwards	—		0.2
Other	—		0.1
Long-term deferred tax assets	27.3		25.9
Less: Valuation allowance	—		(0.1)
Net deferred tax assets	27.3		25.8
Deferred Tax Liabilities
Long-term
Accrued liabilities and allowances	(2.7)		(2.7)
Property and equipment	(9.9)		(9.4)
Intangibles	(15.7)		(12.5)
Investment in partnership	(23.4)		(23.6)
Other	(1.5)		(1.7)
Long-term deferred tax liabilities	(53.2)		(49.9)
Net deferred tax liabilities	$	(25.9)	$	(24.1)
The above amounts are included in our Consolidated Balance Sheets as follows:
Other non-current assets	0.4		0.4
Long-term deferred income tax liabilities	(26.3)		(24.5)
Net deferred tax liabilities	$	(25.9)	$	(24.1)

Valuation Allowance

We assess the available positive and negative evidence to estimate if sufficient future taxable income will be generated to utilize the existing deferred tax assets on a jurisdiction and by tax filing entity basis. A significant piece of objective negative evidence evaluated is cumulative losses incurred over the most recent three-year period. Such objective evidence limits our ability to consider other subjective positive evidence such as our projections for future growth. Based on this evaluation, no valuation allowance has been recorded as of December 31, 2024.

Uncertain Tax Positions

We are subject to taxation in the United States and various state jurisdictions. As of December 31, 2024, our tax years for 2020 through 2023 are subject to examination by the tax authorities. A rollforward of the gross unrecognized tax benefits is as follows (in millions):

Unrecognized tax benefit, December 31, 2021	$	4.3
Increase as a result of tax positions taken during the period	5.4
Decrease as a result of tax positions taken during the period	(4.8)
Increase as a result of expiring statutes	—
Unrecognized tax benefit, December 31, 2022	$	4.9
Increase as a result of tax positions taken during the period	7.5
Decrease as a result of tax positions taken during the period	(5.5)
Increase as a result of expiring statutes	0.1
Unrecognized tax benefit, December 31, 2023	$	7.0
Increase as a result of tax positions taken during the period	7.7
Decrease as a result of tax positions taken during the period	(7.0)
Decrease as a result of expiring statutes	(0.1)
Unrecognized tax benefit, December 31, 2024	$	7.6

We had $0.3 million unrecognized tax benefits at December 31, 2024 that would affect the effective tax rate. Interest expense and penalties accrued related to uncertain tax positions as of December 31, 2024 are $1.2 million.

We expect a decrease to the amount of unrecognized tax benefits (exclusive of penalties and interest) within the next twelve months of zero to $3.9 million.

Determining uncertain tax positions and the related estimated amounts requires judgment and carry estimation risk. If future tax law changes or interpretations should come to light, or additional information should become known, our conclusions regarding unrecognized tax benefits may change.