Income Taxes (Tables)

12 Months Ended

Dec. 31, 2022

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


	Year Ended December 31,
	2022		2021		2020
Current:
U.S. federal	$	38,954	$	93,368	$	24,880
U.S. state and local	21,394		28,392		6,038
Foreign	1,044		258		2,811
UBT	5,161		2,291		2,845
Total	66,553		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

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,
	2022		2021		2020
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 benefit	4,258		58,866		5,984
New York City UBT	1,045		4,658		2,046
Section 162(m) compensation deduction limitation	1,519		9,227		—
Revaluation of deferred taxes related to ownership changes	5,641		(26,159)		(1,851)
Other rate change	(594)		5,249		(2,896)
Section 453A interest	—		—		1,419
Valuation allowance	9,985		5,920		2,137
Prior year true ups	3,232		(6,408)		4,628
Other	1,095		(7,849)		(297)
Provision for income tax	$	42,054	$	242,958	$	36,993

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,
	2022	2021
Deferred tax asset
Basis difference of investments	43,122	36,602
Deferred compensation	116,934	99,414
Other deferred and accrued expenses	13,846	11,182
Net Operating loss and credit carry-forwards	16,126	8,574
Total deferred tax asset	190,028	155,772
Valuation Allowance	(18,504)	(9,562)
Deferred tax asset, net of allowance	171,524	146,210
Deferred tax liability
Depreciation and amortization	76,835	76,019
Other	—	—
Deferred tax liability(1)	76,835	76,019
Net deferred tax asset	94,689	70,191

(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, 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	$	—