Income Taxes

9 Months Ended

Sep. 30, 2024

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The income tax expense was $0.9 million and $1.9 million for the three months ended September 30, 2024 and 2023, respectively. The provision for income taxes resulted in an effective tax rate of 85.9% for the three months ended September 30, 2024 and 75.6% for the three months ended September 30, 2023. The effective income tax rate for the three months ended September 30, 2024 and 2023 differs from the federal statutory rate of 21%, primarily due to the U.S. state income taxes and the impact of income earned in foreign jurisdictions.

The income tax benefit was $8.2 million and income tax provision was $1.6 million for the nine months ended September 30, 2024 and 2023, respectively. The provision for income taxes resulted in an effective tax rate of 22.8% for the nine months ended September 30, 2024 and 79.9% for the nine months ended September 30, 2023. The effective income tax rate for the nine months ended September 30, 2024 and 2023 differs from the federal statutory rate of 21%, primarily due to the U.S. state income taxes and the impact of income earned in foreign jurisdictions.

Harte Hanks, or one of our subsidiaries file income tax returns in the U.S. federal, U.S. state, and foreign jurisdictions. For U.S. state, federal and foreign returns, we are no longer subject to tax examinations for years prior to 2021. The Company has reviewed all of its tax positions in order to determine whether all, a portion, or none of any related tax benefit should be recognized and has not identified or recorded any ASC 740-10 reserve.

We have elected to classify any interest expense and penalties related to income taxes within income tax expense in our Condensed Consolidated Statements of Comprehensive Income (Loss). We did not have a significant amount of interest or penalties accrued at September 30, 2024 or December 31, 2023.