Income Taxes

9 Months Ended

Sep. 30, 2020

Income TaxesOur effective tax rate for the three months ended September 30, 2020 and 2019 was 36.2% and 16.0%, respectively, and 23.1% and 20.5% for the nine months ended September 30, 2020 and 2019, respectively. Our effective tax rate for nine months ended September 30, 2020 differs from our statutory rate primarily due to a research and experimentation tax credit and the effect of excess tax benefits related to the vesting of restricted shares of our common stock, partially offset by the effect of the Optimal Blue acquisition and redeemable noncontrolling interests. Our effective tax rate for nine months ended September 30, 2019 differs from our statutory rate primarily due to the effect of research and experimentation tax credit, the effect of excess tax benefits related to the vesting of restricted shares of our common stock and a deferred tax revaluation adjustment as a result of a reduction in our blended state tax rate driven by a Florida tax rate change.

A reconciliation of the federal statutory income rate to our effective income tax rate for each period presented is as follows:


	Three months ended September 30,				Nine months ended September 30,
	2020		2019		2020		2019
Federal statutory rate	21.0	%	21.0	%	21.0	%	21.0	%
State income taxes, net of federal benefit	4.2		3.8		4.1		4.6
Redeemable noncontrolling interests	7.6		—		1.9		—
Tax credits	(6.9)		(3.8)		(4.3)		(2.4)
Restricted share vesting	(1.0)		(1.3)		(3.1)		(1.8)
Effect of deferred revaluation related to lower blended state tax rate	—		(3.8)		—		(1.3)
Effect of Optimal Blue acquisition and related transactions	9.5		—		2.3		—

Non-deductible executive compensation	1.5		—		1.0		—
Other	0.3		0.1		0.2		0.4
Effective tax rate	36.2	%	16.0	%	23.1	%	20.5	%