Income Taxes

12 Months Ended

Dec. 31, 2020

9. INCOME TAXES

Income before income tax expense (benefit) and equity in losses of 50% or less owned companies derived from U.S. and foreign companies for the years ended December 31, were as follows (in thousands):


	2020		2019		2018
United States	$	20,132	$	41,398	$	33,563
Foreign	4,744		6,182		56,558
Eliminations and other	1,516		1,517		1,568
	$	26,392	$	49,097	$	91,689

The Company files a consolidated U.S. federal tax return. The components of income tax expense (benefit) for the years ended December 31, were as follows (in thousands):


	2020		2019		2018
Current:
State	$	2,301	$	739	$	253
Federal	15,823		(244)		20,776
Foreign	1,151		1,165		2,899
	19,275		1,660		23,928
Deferred:
State	(254)		404		(3,001)
Federal	(25,050)		7,765		(12,512)
Foreign	(1,093)		—		—
	(26,397)		8,169		(15,513)
	$	(7,122)	$	9,829	$	8,415

The following table reconciles the difference between the statutory federal income tax rate for the Company and the effective income tax rate for the years ended December 31,:


	2020		2019		2018
Statutory rate	21.0	%	21.0	%	21.0	%
Income subject to tonnage tax	(7.3)	%	(2.3)	%	(1.3)	%


U.S. federal income tax statutory changes	(49.1)	%	—	%	—	%
Non-deductible expenses	3.4	%	1.6	%	0.2	%
Noncontrolling interests	—	%	(3.1)	%	(5.7)	%
Foreign earnings not subject to U.S. income tax	(4.8)	%	(4.1)	%	(16.2)	%
Foreign taxes not creditable against U.S. income tax	0.2	%	1.4	%	3.2	%

Subpart F income	3.0	%	1.5	%	12.1	%
State taxes	5.9	%	2.0	%	(3.1)	%
Share award plans	1.6	%	0.6	%	(0.3)	%
Other	(0.9)	%	1.4	%	(0.7)	%
	(27.0)	%	20.0	%	9.2	%

On March 27, 2020, the U.S. Congress passed and the President signed the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act") into law to address the economic fallout of the 2020 COVID-19 pandemic. One provision of the CARES Act increases the tax deduction for net operating losses from 80% to 100% for 2018 through 2020, allows net operating losses generated in 2018 through 2020 to be carried back up to five years and increases the deductible interest expense limit from 30% to 50% of taxable EBITDA. As a result of these statutory changes, during the twelve months ended December 31, 2020, the Company determined it will be able to carry its 2019 net operating losses back to tax years when the statutory tax rate was 35% resulting in an income tax benefit of $13.0 million, which is included in income tax expense (benefit) in the accompanying consolidated statements of income.

As of December 31, 2020, $32.7 million of income tax receivables are included in other receivables in the accompanying condensed consolidated balance sheets.

The components of the net deferred income tax liabilities for the years ended December 31, were as follows (in thousands):


	2020		2019
Deferred tax liabilities:
Property and equipment	$	114,577	$	121,840
Long-term debt	10,905		15,395
Gains on marketable securities	340		459
Investments in 50% or less owned companies	774		1,541
Intangible assets	562		706
Deductible goodwill	1,659		1,002

Total deferred tax liabilities	128,817		140,943
Deferred tax assets:
Federal net operating loss carryforwards	2,022		21,385
State net operating loss carryforwards and other temporary differences	5,804		4,922
Capital loss carryforwards	5,199		5,192
Share award plans	3,853		3,686


Other	5,870		4,314
Total deferred tax assets	22,748		39,499
Valuation allowance	(4,846)		(4,217)
Net deferred tax assets	17,902		35,282
Net deferred tax liabilities	$	110,915	$	105,661

During the year ended December 31, 2020, the Company increased its valuation allowance for state net operating loss carryforwards from $4.2 million to $4.8 million. The Company's capital loss carryforwards expire in 2024.