Income Taxes (Tables)

12 Months Ended

Dec. 31, 2020

The provision for income taxes consisted of the following (in thousands):


	Year Ended December 31,
	2020		2019		2018
Current:
U.S. federal	$	24,880	$	63,359	$	49,985
U.S. state and local	6,038		15,130		19,290
Foreign	2,811		464		1,239
UBT	2,845		1,335		3,586
Total	36,574		80,288		74,100
Deferred:
U.S. federal	3,249		(25,103)		(9,972)
U.S. state and local	(1,912)		(4,025)		24,092
Foreign	(120)		(15)		—
UBT	(798)		1,291		2,267
Total	419		(27,852)		16,387
Provision for income taxes	$	36,993	$	52,436	$	90,487

Schedule of difference between actual income tax expense and the amount calculated utilizing the U.S. Federal Statutory Rates

Differences between Newmark’s actual income tax expense and the amount calculated utilizing the U.S. federal statutory rates were as follows (in thousands):


	Year Ended December 31,
	2020		2019		2018
Tax expense at federal statutory rate	$	30,717	$	44,971	$	59,297
Non-controlling interest	(10,378)		(15,097)		(26,257)
Incremental impact of foreign taxes compared to the federal rate	212		(145)		44
Other permanent differences	5,272		9,915		9,948
U.S. state and local taxes, net of U.S. federal benefit	5,984		12,271		13,353
New York City UBT	2,046		2,627		3,119
Amortization of intangibles	—		—		—
Revaluation of deferred taxes related to tax reform	—		—		—
Other rate change	(4,747)		2,457		23,001
Section 453A interest	1,419		1,640		2,003
Valuation allowance	2,137		2,902		1,281
Prior year true ups	4,628		(7,981)		2,341
Other	(297)		(1,124)		2,357
Provision for income tax	$	36,993	$	52,436	$	90,487

Schedule of deferred tax assets and liabilities

Significant components of Newmark's deferred tax asset and liability consisted of the following (in thousands):


	December 31,
	2020		2019
Deferred tax asset
Basis difference of investments	$	65,954	$	54,445
Deferred compensation	167,251		153,978
Other deferred and accrued expenses	4,584		7,655
Net Operating loss and credit carry-forwards	2,447		4,216
Total deferred tax asset	240,236		220,294
Valuation Allowance	(2,035)		(3,973)
Deferred tax asset, net of allowance	238,201		216,321
Deferred tax liability
Depreciation and amortization	50,675		30,156
Other	—		3,384
Deferred tax liability(1)	50,675		33,540
Net deferred tax asset	$	187,526	$	182,781

(1)Before netting within tax jurisdictions.

Schedule of reconciliation of beginning and ending amounts of unrecognized tax benefits

A reconciliation of the beginning to the ending amounts of gross unrecognized tax benefits for the years ended December 31, 2020, 2019 and 2018 is as follows (in thousands):


Balance, January 1, 2018	$	208
Increases for prior year tax positions	—
Decreases for prior year tax positions	—
Increases for current year tax positions	—
Decreases related to settlements with taxing authorities	—
Decreases related to a lapse of applicable statute of limitations	—
Balance, December 31, 2019	208
Increases for prior year tax positions	—
Decreases for prior year tax positions	—
Increases for current year tax positions	—
Decreases related to settlements with taxing authorities	—
Decreases related to a lapse of applicable statute of limitations	—
Balance, December 31, 2020	$	208