Income Taxes

12 Months Ended

Dec. 31, 2022

Income Tax Disclosure [Abstract]

Income Taxes

Note 14. Income Taxes

Although the Company is a Delaware limited partnership, we are subject to corporate income tax on our share of the Partnership’s earnings because of our election to be treated as a corporation for U.S. federal and state income tax purposes. The provision (benefit) for income taxes consisted of:

	Year Ended December 31,
(in millions)	2022		2021		2020
Federal
Current	$	0.1	$	0.1	$	-
Deferred taxes and other accruals		22.8		12.5		6.2
State		3.7		2.0		1.1
Total provision (benefit) for income taxes	$	26.6	$	14.6	$	7.3

The difference between the effective income tax rate and the U.S. statutory rate is reconciled below:

	Year Ended December 31,
	2022				2021				2020
U.S. statutory rate		21.0		%		21.0		%		21.0		%
Noncontrolling interest in partnership		(17.4	)			(19.0	)			(19.7	)
State tax		0.5				0.3				0.2
Effective rate		4.1		%		2.3		%		1.5		%

As a result of the equity offering and repurchase transactions (see Note 3, Equity Transactions), we recognized an additional deferred tax asset in the total amount of $86.4 million (2021: $89.0 million) related to the change in the temporary difference between carrying amount and tax basis of our investment in the Partnership. The effect of recognizing the additional deferred tax asset was included in Class A shareholders’ equity balance in the accompanying consolidated statement of changes in partners’ capital due to the transactions being characterized as transactions among or with shareholders.

The components of deferred tax assets and liabilities are as follows:

	December 31,
	2022			2021
(in millions)
Deferred tax liabilities
Investments	$	(0.5	)	$	(0.4	)
Total deferred tax liabilities		(0.5	)		(0.4	)
Deferred tax assets
Investments		148.9			102.3
Net operating loss carryforwards		28.3			15.0
Total deferred tax assets		177.2			117.3
Net deferred tax assets (liabilities)	$	176.7		$	116.9

At December 31, 2022, we have recognized a deferred tax asset of $23.5 million related to U.S. federal net operating loss carryforwards which do not expire and $4.8 million related to U.S. state net operating loss carryforwards which begin to expire in 2030. We have no unrecognized tax benefits or interest and penalties related to tax liabilities recorded in the financial statements. For the years presented, we earned all net income before taxes in the United States. We file income tax returns in the U.S. and various states. We are not subject to corporate income tax examination for years prior to 2019.