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Income Taxes
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The 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 UBT in New York City, Connecticut and other jurisdictions. 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 in Newmark Holdings and BGC Holdings” for a 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,
 202320222021
Current:  
U.S. federal$28,317 $38,954 $93,368 
U.S. state and local11,634 21,394 28,392 
Foreign3,881 1,044 258 
UBT2,466 5,161 2,291 
Total$46,298 $66,553 $124,309 
Deferred:
U.S. federal(2,592)(18,165)81,645 
U.S. state and local(2,074)(5,974)34,675 
Foreign(91)(131)(38)
UBT(438)(229)2,367 
Total$(5,195)$(24,499)$118,649 
Provision for income taxes$41,103 $42,054 $242,958 
 
Newmark had pre-tax income of $103.5 million, $154.6 million and $1,221.1 million for the years ended December 31, 2023, 2022 and 2021, respectively. Newmark had pre-tax income/(loss) from foreign operations of $(8.4) million, $(37.5) million and $4.8 million for the years ended December 31, 2023, 2022 and 2021, 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,
 202320222021
Tax expense at federal statutory rate$21,728 $32,467 $256,430 
Non-controlling interest(5,909)(11,054)(57,269)
Incremental impact of foreign taxes compared to the federal rate(2,127)(270)(557)
Other permanent differences(1)(5,270)850 
U.S. state and local taxes, net of U.S. federal benefit5,872 4,258 58,866 
New York City UBT1,041 1,045 4,658 
Section 162(m) compensation deduction limitation5,806 1,519 9,227 
Revaluation of deferred taxes related to ownership changes2,752 5,641 (26,159)
Other rate change(1,408)(594)5,249 
Valuation allowance6,881 9,985 5,920 
Prior year true ups7,439 3,232 (6,408)
Other(971)1,095 (7,849)
Provision for income tax$41,103 $42,054 $242,958 

 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,
 20232022
Deferred tax asset
Basis difference of investments$42,734 $43,122 
Deferred compensation125,304 116,934 
Other deferred and accrued expenses15,944 13,846 
Net operating loss and credit carry-forwards
22,379 16,126 
             Total deferred tax asset206,361 $190,028 
Valuation Allowance(25,385)(18,504)
             Deferred tax asset, net of allowance180,976 $171,524 
Deferred tax liability
Depreciation and amortization77,469 76,835 
Other3,278 — 
             Deferred tax liability(1)
80,747 $76,835 
Net deferred tax asset$100,229 $94,689 
(1)Before netting within tax jurisdictions.

Newmark has NOLs in non-U.S. jurisdictions of an approximate tax effected value of $21.9 million, of which $12.1 million has an indefinite life. The rest of $9.8 million primarily consists of the Canada NOL which has a 20 year life. Management assesses the available positive and negative evidence to determine whether existing deferred tax assets will be realized. Accordingly, a total valuation allowance of $25.4 million has been recorded against the deferred tax assets, primarily related to certain NOLs 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 2020, 2018 and 2020, respectively.

The Company has elected to treat taxes associated with the Global Intangible Low-Taxed Income (GILTI) provision using the Period Cost Method and thus has not recorded deferred taxes for basis differences under this regime as of December 31, 2023.

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, 2023, 2022 and 2021 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— 
Balance, December 31, 2023$— 

As of December 31, 2023 and 2022, 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. As of December 31, 2023 and 2022, Newmark did not accrue any unrecognized tax benefits related interest and penalties.