XML 41 R22.htm IDEA: XBRL DOCUMENT v3.22.4
INCOME TAXES
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
The income tax expense in the consolidated statements of income consists of the following:
For the Years Ended December 31,
(dollars in thousands)202220212020
Current - federal$114,346 $67,076 $73,705 
Current - state27,889 13,712 12,479 
Deferred - federal(27,408)30,321 (7,881)
Deferred - state(8,269)8,090 (47)
$106,558 $119,199 $78,256 

The Company’s income tax expense differs from the amounts computed by applying the federal income tax statutory rates to income before income taxes. A reconciliation of the differences is as follows:
For the Years Ended December 31,
(dollars in thousands)202220212020
Federal income statutory rate21 %21 %21 %
Tax at federal income tax rate$95,151 $104,166 $71,460 
Change resulting from:
State income tax, net of federal benefit13,763 18,923 9,812 
Tax-exempt interest(2,775)(3,479)(3,726)
Increase in cash value of bank owned life insurance(1,399)(997)(594)
Excess tax (benefit) deficiency from stock compensation(510)(277)371 
Nondeductible merger expenses167 142 2 
Other2,161 721 2,827 
Benefit related to carryback claims resulting from the CARES Act— — (1,896)
Provision for income taxes$106,558 $119,199 $78,256 
The components of deferred income taxes are as follows:
December 31,
(dollars in thousands)20222021
Deferred tax assets
Allowance for credit losses$64,742 $50,132 
Deferred compensation13,287 7,816 
Deferred loan fees668 1,593 
Purchase accounting adjustments5,153 14,008 
Other real estate owned201 334 
Net operating loss tax carryforward14,070 35,082 
Tax credit carryforwards149 315 
Unrealized loss on securities available for sale14,635 — 
Capitalized costs, accrued expenses and other3,432 2,208 
Lease liability16,505 16,186 
132,842 127,674 
Deferred tax liabilities
Premises and equipment12,680 13,130 
Mortgage servicing rights30,903 52,076 
Subordinated debentures6,551 6,818 
Lease financing9,442 42,865 
Goodwill and intangible assets24,946 29,393 
Unrealized gain on securities available-for-sale— 4,498 
Origination costs6,239 — 
Right of use lease asset14,280 14,001 
105,041 162,781 
Net deferred tax asset (liability)$27,801 $(35,107)

At December 31, 2022, the Company had federal net operating loss carryforwards of approximately $57.8 million which expire at various dates from 2028 to 2036. At December 31, 2022, the Company had state net operating loss carryforwards of approximately $53.8 million which expire at various dates from 2028 to 2036. The federal net operating loss carryforwards are subject to limitations pursuant to Section 382 of the Internal Revenue Code and are expected to be recovered over the next 13 years. The state net operating loss carryforwards are subject to similar limitations and are expected to be recovered over the next 13 years. Deferred tax assets are recognized for net operating losses because the benefit is more likely than not to be realized.

Section 2303(b) of the CARES Act allows for certain net operating losses generated after December 31, 2017, but before December 31, 2021, to be carried back to the five tax years preceding the loss. The Company carried back approximately $13.2 million of eligible net operating losses to preceding tax years. The Company recorded a benefit of $1.9 million due to the carryback of these net operating losses for the tax year ended December 31, 2020.

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based on the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, management believes it is more likely than not that the Company will realize the benefits of these deferred tax assets at December 31, 2022.

As described in Note 2 to the consolidated financial statements, in December 2021 Ameris Bank acquired Balboa Capital Corporation. The Company completed its analysis of the tax effects of this transaction during 2022. The consolidated balance sheet reflects this final analysis.

The Company and its subsidiaries are subject to U.S. federal income tax as well as income tax of the various states. The Company is no longer subject to examination by federal taxing authorities for years before 2019 and state taxing authorities for years before 2018.
Although Ameris is unable to determine the ultimate outcome of current and future events, Ameris believes that the liability recorded for uncertain tax positions is adequate. A reconciliation of the beginning and ending amount of unrecognized income tax benefits is as follows.

For the Years Ended December 31,
(dollars in thousands)20222021
Beginning Balance$1,903 $— 
Current Activity:
Additions for tax positions of prior years2,319 1,903 
Additions from acquisitions1,001 — 
Settlements(4,222)— 
Ending Balance$1,001 $1,903 

Accrued interest and penalties related to unrecognized income tax benefits are included as a component of income tax expense. Accrued interest and penalties on unrecognized income tax benefits totaled $11,000 and $331,000 as of December 31, 2022 and 2021, respectively. Unrecognized income tax benefits as of December 31, 2022 and 2021, that, if recognized, would affect the effective income tax rate totaled $919,000 and $1.8 million (net of the federal benefit on state income tax issues), respectively. Accruals of penalties and interest resulted in a expense of $153,000 and $248,000 in 2022 and 2021, respectively. Ameris expects that all uncertain income tax positions will be either settled or resolved during the next twelve months.

The Company did not record any interest and penalties related to income taxes for the year ended December 31, 2020.