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Income Taxes
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
Income Taxes Income TaxesThe accompanying consolidated financial statements include U.S. federal, state and local income taxes on Newmark’s allocable share of its U.S. results of operations, as well as taxes payable to jurisdictions outside the U.S. In addition, certain of Newmark’s entities are taxed as U.S. partnerships and are subject to the Unincorporated Business Tax (“UBT”) in New York City and Connecticut. Therefore, the tax liability or benefit related to the partnership income or loss except for UBT, rests with the partners (see Note 2 — “Limited Partnership Interests”, for discussion of partnership interests), rather than the partnership entity. Income taxes are accounted for using the asset and liability method, as prescribed in U.S. GAAP guidance for Income Taxes. The provision for income taxes consisted of the following (in thousands):
 Year Ended December 31,
 202220212020
Current:  
U.S. federal$38,954 $93,368 $24,880 
U.S. state and local21,394 28,392 6,038 
Foreign1,044 258 2,811 
UBT5,161 2,291 2,845 
Total66,553 124,309 36,574 
Deferred:
U.S. federal(18,165)81,645 3,249 
U.S. state and local(5,974)34,675 (1,912)
Foreign(131)(38)(120)
UBT(229)2,367 (798)
Total(24,499)118,649 419 
Provision for income taxes$42,054 $242,958 $36,993 
 
Newmark had pre-tax income of $154.6 million, $1,221.1 million and $146.3 million for the years ended December 31, 2022, 2021 and 2020, respectively. Newmark had pre-tax income/(loss) from foreign operations of $(37.5) million, $4.8 million and $(4.5) million for the years ended December 31, 2022, 2021 and 2020, respectively.

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,
 202220212020
Tax expense at federal statutory rate$32,467 $256,430 $30,717 
Non-controlling interest(11,054)(57,269)(10,378)
Incremental impact of foreign taxes compared to the federal rate(270)(557)212 
Other permanent differences(5,270)850 5,272 
U.S. state and local taxes, net of U.S. federal benefit4,258 58,866 5,984 
New York City UBT1,045 4,658 2,046 
Section 162(m) compensation deduction limitation1,519 9,227 — 
Revaluation of deferred taxes related to ownership changes5,641 (26,159)(1,851)
Other rate change(594)5,249 (2,896)
Section 453A interest— — 1,419 
Valuation allowance9,985 5,920 2,137 
Prior year true ups3,232 (6,408)4,628 
Other1,095 (7,849)(297)
Provision for income tax$42,054 $242,958 $36,993 

 Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recorded against deferred tax assets if it is deemed more likely than not that those assets will not be realized. 

Significant components of Newmark's deferred tax asset and liability consisted of the following (in thousands):
December 31,
 20222021
Deferred tax asset
Basis difference of investments43,122 36,602 
Deferred compensation116,934 99,414 
Other deferred and accrued expenses13,846 11,182 
Net Operating loss and credit carry-forwards16,126 8,574 
             Total deferred tax asset190,028 155,772 
Valuation Allowance(18,504)(9,562)
             Deferred tax asset, net of allowance171,524 146,210 
Deferred tax liability
Depreciation and amortization76,835 76,019 
Other— — 
             Deferred tax liability(1)
76,835 76,019 
Net deferred tax asset94,689 70,191 
(1)Before netting within tax jurisdictions.

Newmark has net operating losses ("NOL") in non-U.S. jurisdictions of an approximate tax effected value of $15.8 million, of which $10.1 million has an indefinite life. The remaining $5.7 million consists of Canada and Mexico NOL which have 10-year and 20-year lives, respectively. Management assesses the available positive and negative evidence to determine whether existing deferred tax assets will be realized. Accordingly, a total valuation allowance of $18.5 million has been recorded against the deferred tax assets, primarily related to certain net operating losses in non-U.S. jurisdictions as it is more likely than not to be realized. Newmark’s deferred tax asset and liability are included on the accompanying consolidated balance sheets as components of “Other assets” and “Other liabilities”, respectively.

The Company files income tax returns in the United States federal jurisdiction and various states, local and foreign jurisdictions. The Company is currently open to examination by tax authorities in United States federal, state and local jurisdictions and certain non-U.S. jurisdictions for tax years beginning 2019, 2018 and 2018, respectively.

The Company has elected to treat taxes associated with the GILTI provision using the Period Cost Method and thus has not recorded deferred taxes for basis differences under this regime as of December 31, 2022.

Pursuant to U.S. GAAP guidance on Accounting for Uncertainty in Income Taxes, Newmark provides for uncertain tax positions based upon management’s assessment of whether a tax benefit is more likely than not to be sustained upon examination by tax authorities.

A reconciliation of the beginning to the ending amounts of gross unrecognized tax benefits for the years ended December 31, 2022, 2021 and 2020 is as follows (in thousands):

Balance, January 1, 2021$208 
Decreases related to a lapse of applicable statute of limitations(208)
Balance, December 31, 2021— 
Balance, December 31, 2022$— 
As of December 31, 2022 and 2021, Newmark did not have any unrecognized tax benefits which, if recognized, would affect the effective tax rate. Newmark recognized interest and penalties related to income tax matters in “Provision for income taxes” on the accompanying consolidated statements of operations.