Income Taxes

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Income Taxes

9. INCOME TAXES

Components of the provision for income taxes are as follows:

	Years Ended December 31,
(in millions)	2023		2022		2021
Current provision:
Federal	$	74.4	$	41.0	$	66.1
State and local	22.8		19.7		18.5
Foreign	(0.1)		—		0.1
	97.1		60.7		84.7
Deferred provision:
Federal	42.5		79.9		7.5
State and local	4.9		28.8		2.3
Foreign	—		—		—
	47.4		108.7		9.8
Income tax provision	$	144.5	$	169.4	$	94.5

Income before provision for income taxes were as follows:

	Years Ended December 31,
(in millions)	2023		2022		2021
Domestic	$	561.8	$	608.9	$	343.7
Foreign	—		(0.1)		(0.1)
Income before provision for income taxes	$	561.8	$	608.8	$	343.6

Our income tax provision is different from the amount computed by applying the federal statutory income tax rate to income before taxes as follows:

	Years Ended December 31,
(in millions)	2023		2022		2021
Federal statutory tax on earnings before income taxes	$	117.9	$	127.9	$	72.1
State income taxes, net of federal income tax benefit	21.6		32.6		15.8
Non-deductible officer's compensation	6.1		7.6		6.4
Other	(1.1)		1.3		0.2
Income tax provision	$	144.5	$	169.4	$	94.5

Components of our deferred tax assets and liabilities were as follows:

	December 31,
(in millions)	2023		2022
Deferred tax assets:
§ 163(j) interest expense limitation carryforward	$	55.0	$	18.2
Lease liabilities	16.5		12.6
Net operating losses and credits carryforward	6.5		8.1
Deferred liabilities	8.1		7.4
Deferred compensation plans	7.9		7.0
Deferred income	3.3		3.6
Research and experimental expenditures	2.2		3.0
Deferred tax assets	99.5		59.9
Valuation allowance	(4.6)		(5.7)
Net deferred tax asset	94.9		54.2
Deferred tax liabilities:
Property and equipment in excess of tax basis	195.1		158.7
Equity investments in excess of tax basis	148.0		141.6
Intangible assets in excess of tax basis	119.1		78.1
Right-of-use assets	15.9		12.3
Other	5.0		4.3
Deferred tax liabilities	483.1		395.0
Net deferred tax liability	$	(388.2)	$	(340.8)

As of December 31, 2023, we had U.S. state and foreign net operating losses with tax values of $6.4 million and $0.5 million, respectively. We have recorded a valuation allowance of $4.6 million due to the fact that it is unlikely that we will generate income in certain state and foreign jurisdictions which is necessary to utilize the deferred tax assets. We also had U.S. state tax credits with a tax value of $1.3 million that do not expire which we expect to fully utilize.

The Internal Revenue Service has completed audits through 2012. Tax years 2020 and after are open to examination. Tax years 2015 and 2018 are open to examination as a result of the Company's claim for refund of 2015 and 2018 tax from carrying back its 2020 net operating loss and 2021 capital loss pursuant to the CARES Act.

As of December 31, 2023, we had approximately $4.8 million of total gross unrecognized tax benefits, excluding interest of $0.4 million. If the total gross unrecognized tax benefits were recognized, there would be a $4.5 million effect to the annual effective tax rate. We anticipate a decrease in our unrecognized tax positions of approximately $0.8 million during the next twelve months primarily due to expected settlements with tax authorities and the expiration of statutes of limitation.

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

(in millions)	2023		2022		2021
Balance as of January 1	$	6.4	$	3.9	$	3.9
Additions for tax positions related to the current year	0.2		0.1		0.1
Additions for tax positions of prior years	0.3		2.9		1.0
Reductions for tax positions of prior years	(2.1)		(0.5)		(1.1)
Balance as of December 31	$	4.8	$	6.4	$	3.9