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Income Taxes
3 Months Ended
Mar. 31, 2021
Income Tax Disclosure [Abstract]  
Income taxes Income taxesOur effective tax rate in the three months ended March 31, 2021 and March 31, 2020 was 22.8% in each period. Our effective tax rate differs from the federal statutory rate primarily due to state tax expense partially offset by benefits associated with federal energy efficient home credits and equity compensation.
At March 31, 2021 and December 31, 2020, we had deferred tax assets, net of deferred tax liabilities and valuation allowance, of $21.3 million and $32.7 million, respectively. The accounting for deferred taxes is based upon estimates of future results. Differences between estimated and actual results could result in changes in the valuation of deferred tax assets that could have a material impact on our consolidated results of operations or financial position. Changes in existing tax laws could also affect actual tax results and the realization of deferred tax assets over time.

Unrecognized tax benefits represent the difference between tax positions taken or expected to be taken in a tax return and the benefits recognized for financial statement purposes. We had $33.5 million and $30.9 million of gross unrecognized tax benefits at March 31, 2021 and December 31, 2020, respectively. Additionally, we had accrued interest and penalties of $3.2 million and $2.8 million at March 31, 2021 and December 31, 2020, respectively.