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Non-controlling Interest (Tables)
3 Months Ended
Mar. 31, 2020
Noncontrolling Interest  
Summary of Ownership of the Common Units

March 31, 2020

December 31, 2019

    

Shares

    

Ownership %

    

Shares

    

Ownership %

 

Non-controlling interest ownership of common units in RMCO

12,559,600

40.9

%  

12,559,600

41.3

%

Holdings outstanding Class A common stock (equal to Holdings common units in RMCO)

18,123,963

59.1

%  

17,838,233

58.7

%

Total common units in RMCO

30,683,563

100.0

%  

30,397,833

100.0

%

Reconciliation from Income Before Provision for Income Taxes to Net Income

The weighted average ownership percentages for the applicable reporting periods are used to calculate the “Net income attributable to RE/MAX Holdings, Inc.” A reconciliation of “Income before provision for income taxes” to “Net Income attributable to RE/MAX Holdings, Inc.” and “Net Income attributable to non-controlling interest” in the accompanying Condensed Consolidated Statements of Income for the periods indicated is detailed as follows (in thousands, except percentages):

Three Months Ended March 31, 

2020

2019

RE/MAX
Holdings,
Inc.

Non-controlling
interest

Total

RE/MAX
Holdings,
Inc.

Non-controlling
interest

Total

Weighted average ownership percentage of RMCO(a)

58.9

%

41.1

%

100.0

%

58.6

%

41.4

%

100.0

%

Income before provision for income taxes(a)

$

5,552

$

3,528

$

9,080

$

5,958

$

4,207

$

10,165

Provision for income taxes(b)(c)

(2,921)

(869)

(3,790)

(1,549)

(359)

(1,908)

Net income

$

2,631

$

2,659

$

5,290

$

4,409

$

3,848

$

8,257

(a)The weighted average ownership percentage of RMCO differs from the allocation of income before provision for income taxes between Holdings and the non-controlling interest due to (i) certain relatively insignificant expenses and (ii) the gain on reduction in TRA liability in 2020 attributable only to Holdings.
(b)The provision for income taxes attributable to Holdings is primarily comprised of U.S. federal and state income taxes on its proportionate share of the pass-through income from RMCO. It also includes Holdings’ share of taxes directly incurred by RMCO and its subsidiaries, related primarily to tax liabilities in certain foreign jurisdictions. In the three months ended March 31, 2020, the provision for income taxes attributable to Holdings also includes a decrease in the value of deferred tax assets. See Note 10, Income Taxes for additional information.
(c)The provision for income taxes attributable to the non-controlling interest represents its share of taxes related primarily to tax liabilities in certain foreign jurisdictions directly incurred by RMCO or its subsidiaries. Otherwise, because RMCO is a pass-through entity, there is no U.S. federal and state income tax provision recorded on the non-controlling interest.
Distributions Paid or Payable

f$

Three Months Ended

March 31, 

    

2020

    

2019

Tax and other distributions

$

14

$

55

Dividend distributions

2,763

2,638

Total distributions to non-controlling unitholders

$

2,777

$

2,693