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Income Taxes
 12 Months Ended
Dec. 31, 2021
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The Company does not have operations in foreign jurisdictions. The provision (benefit) for income taxes for the years ended December 31, 2021, 2020 and 2019 are as follows:
For the Year Ended December 31,
(in thousands)202120202019
Current
Federal$95,674 $14,602 $96,148 
State and local19,628 4,096 16,055 
$115,302 $18,698 $112,203 
Deferred
Federal$(73,987)$(48,168)$(97,326)
State and local(7,942)3,127 (14,078)
(81,929)(45,041)(111,404)
Total provision (benefit) from continuing operations$33,373 $(26,343)$799 
The Company's provision for income taxes for the years ending December 31, 2021, 2020 and 2019 continues to be impacted by the TCJA, which was enacted into law on December 22, 2017. Income tax effects resulting from changes in tax laws are accounted for by the Company in accordance with the authoritative guidance, which requires that these tax effects be recognized in the period in which the law is enacted. During 2020 the Internal Revenue Service issued final regulations relating to the TCJA that the Company assessed and was accounted for in the period when issued. Additional changes under the CARES act in Q1 2020 increased the allowable interest expense deduction for 2019 and 2020. These changes reduced the Company's deferred tax asset and taxes payable in the amount of $32.5 million. This was recorded in the period of enactment. Other impacts of the CARES act were reviewed and determined not to be material to the Company.
The pre-tax income during the year ended December 31, 2021 of $135.5 million generated an income tax provision of $33.4 million. The pre-tax loss during the year ended December 31, 2020 was $546.9 million which generated income tax benefits of $26.3 million. The pre-tax income during the year ended December 31, 2019 of $10.5 million generated an income tax provision of $0.8 million.
The reconciliation of the tax provision at the U.S. federal statutory rate to the provision for income taxes and the effective tax rate for the years ended December 31, 2021, 2020 and 2019 is as follows:
For the Year Ended December 31,
(in thousands)202120202019
Tax at Statutory$28,445 $(114,850)$2,207 
Non-Deductible Expenses279 639 75 
Equity Compensation Plan443 85,227 (3,125)
Non-Deductible change in fair value of Private Placement Warrants and unvested founder shares Liability(6,845)(7,439)— 
State Taxes (net)6,003 (1,741)1,704 
Valuation Allowance1,127 2,555 — 
Non-Deductible Compensation1,561 2,725 — 
Tax Credits(1,064)(915)— 
Other131 40 87 
State Deferred Rate Changes3,293 7,416 (149)
Total$33,373 $(26,343)$799 
Our effective tax rate for the years ended December 31, 2021, 2020 and 2019 differed from the statutory rate primarily due to non-deductible stock-based compensation expense, non-deductible mark-to-market liability, limitations on executive compensation, changes in the Company's deferred state tax rate due to the DHP acquisition, tax credits, operations, and state tax expense.
The following are significant deferred income tax assets and liabilities as of December 31, 2021 and 2020:
As of December 31,
(in thousands)20212020
Deferred income tax assets:
Allowances on trade receivables$82 $93 
Net operating loss carryforwards934 432 
Capital loss carryforwards1,421 153 
Accrued expenses and reserves4,864 4,205 
Interest limitation carryforward57,011 47,192 
Leases – right-of-use liability7,935 8,311 
Transaction expenses7,696 8,422 
Other494 50 
Valuation allowance(1,421)(153)
Deferred income tax assets$79,016 $68,705 
Deferred income tax liabilities:
Intangible assets778,209 846,049 
Depreciable assets47,168 42,078 
Leases – right-of-use asset7,108 7,712 
Debt costs— 73,027 
Other356 472 
Deferred income tax liabilities832,841 969,338 
Net deferred income tax liabilities$753,825 $900,633 
The Company has NOL carry forwards for federal income tax purposes of $2.9 million, $0.6 million tax effected, that will be available to reduce future taxable income. The utilization of most of these losses is subject to annual limitations under federal income tax law. The Company believes that it will be able to fully utilize these losses under current federal tax law. The net operating losses begin to expire in 2022. The Company has net operating loss carry forwards for state income tax purposes of $0.3 million. The Company believes that it will be able to fully utilize these losses under current state tax laws. Substantially all of the Company's state NOL carryforwards expire by 2025. The Company has disallowed interest carry forwards for federal income tax purposes of $241.5 million, $57.0 million tax effected, that will be available to reduce future taxable income, subject to certain income limitations and which have an indefinite carryforward period. The Company believes it is more likely than not that these interest carryforwards will be fully utilized considering the weight of all positive and negative evidence under current tax laws.
During the third and fourth quarters of 2020, the Company marked-to-market certain investments which would result in a capital loss deferred tax asset for which the Company recorded a corresponding valuation allowance of $2.6 million. Commensurate with the Transactions, one of these investments and the corresponding deferred tax asset related valuation allowance, were written off to additional paid-in capital totaling $2.4 million. As of December 31, 2021, the Company increased the valuation allowance related to the remaining estimated capital losses in excess of capital gain based on the difference between the tax and book balance of these investments. It is more likely than not the Company will not generate capital gain income to offset these losses.
The Company does not have reserves for uncertain tax positions. Any need for a reserve or changes in a reserve would be a component of the Company's tax provision. The Company includes interest and tax penalties as part of the tax provision. The Company does not reasonably expect any other significant changes in the next twelve months.
Various regulatory tax authorities periodically examine the Company's and its subsidiaries' tax returns. Tax years December 2018 through 2021 are open for Federal examination. The Company's closed its 2017 IRS audit during the year. There were no impacts to the 2021 financial statements. Tax years 2018 through 2021 are still open for examination related to income taxes to various state taxing authorities.