Income Taxes

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. We recognize deferred tax assets to the extent that we believe these assets are more likely than not to be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If we determine that we would be able to realize our deferred tax assets in the future in excess of their net recorded amount, we would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. We record uncertain tax positions on the basis of a two-step process whereby (1) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority.

The (benefit) expense for income taxes consists of:

	Year Ended December 31,
	2020		2019		2018
Current:
Federal	—		—		$	42,805
State	4		—		1,210
Deferred and Other:
Federal	—		(2,000)		(40,805)
State	—		—		—
Total tax expense (benefit)	$	4	$	(2,000)	$	3,210

The reconciliation between our effective tax rate on income from operations and the statutory rate is as follows:

	Year Ended December 31,
	2020			2019			2018
Income tax (benefit) expense at federal statutory rate	$	1,568		$	(5,909)		$	39,113
State and local income taxes net of federal tax benefit	4			—			1,210
Permanent differences	(1,766)			(2,406)			(143)
Timing differences
Installment note on land sale	—			—			(2,876)
Allowance for losses on note	—			—			(383)
Deferred gains	(878)			(588)			(9,417)
Basis difference on fixed assets	1,307			—			23,675
Other basis/timing differences	2,296			3,173			(7,164)
Generation (use) of net operating loss carryforwards	(2,527)			3,730			(40,805)
Calculated income tax expense (benefit)	$	4		$	(2,000)		$	3,210
Effective tax rate	—		%	—		%	0.6		%

We are subject to taxation in the United States and various states and foreign jurisdictions.  As of December 31, 2020, our tax years for 2019, 2018, and 2017 are subject to examination by the tax authorities.  With few exceptions, as of December 31, 2020, we are no longer subject to U.S federal, state, local, or foreign examinations by tax authorities for the years before 2016.

The 2020 and 2019 effective tax rate is driven primarily by the passing of the Tax Cuts and Jobs Act by congress on December 22, 2017.  This act reduced the statutory tax rate for corporations to 21%, starting in 2019. As a result, our tax assets were remeasured to reflect the new tax rate for future years with the impact on the 2018 provision for income taxes.

Components of the Net Deferred Tax Asset or Liability

	Year Ended December 31,
	2020		2019
Cumulative foreign currency translation loss	$	3,818	1,522
Basis difference for fixed assets	1,426		—
Deferred gain	1,956		1,988
Net operating loss carryforward	7,107		9,633
	14,307		13,143
Less: valuation allowance	(14,307)		(6,480)
	$	—	$	6,663
Deferred gain	$	—	$	—
Basis differences for fixed assets	—		6,663
Total Deferred Tax Liability	$	—	$	6,663
Current net deferred tax asset	—		6,663
Long-term net deferred tax liability	—		(6,663)
	$	—	$	—

We have state net operating losses in many of the various states in which we operate.

We assess the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. At December 31, 2020, we had a net deferred tax asset due to tax deductions available to us in future years. However, as we could not determine that it was more likely than not that we would realize the benefit of the deferred tax asset, we established a 100% valuation allowance.