Income Taxes

12 Months Ended

Dec. 31, 2022

Income Tax Disclosure [Abstract]

Income Taxes

NOTE 12 Income Taxes

Net deferred tax assets (liabilities) as reported on the consolidated balance sheet as of December 31, 2022 and 2021 are shown in table 12.1 below. At December 31, 2021 the deferred tax liability is included as a component of Other liabilities on the consolidated balance sheet.

Deferred tax assets and liabilities
Table	12.1
(In thousands)		2022		2021
Total deferred tax assets		$	144,819	$	32,331
Total deferred tax liabilities		(20,050)		(71,743)
Net deferred tax asset (liability)		$	124,769	$	(39,412)

Table 12.2 includes the components of the net deferred tax asset (liability) as of December 31, 2022 and 2021.

Deferred tax components
Table	12.2
(In thousands)		2022		2021
Unearned premium reserves		$	16,209	$	19,116
Benefit plans		(9,444)		(21,360)
Loss reserves		1,785		4,034
Unrealized depreciation (appreciation) in investments		108,588		(39,883)
Deferred policy acquisition cost		(4,003)		(4,551)
Deferred compensation		6,806		6,118
Research and experimental costs		9,719		—
Other, net		(4,891)		(2,886)
Net deferred tax asset (liability)		$	124,769	$	(39,412)

We believe that all gross deferred tax assets at December 31, 2022 and 2021 are fully realizable and no valuation allowance has been established.

Table 12.3 summarizes the components of the provision for income taxes:

Provision for (benefit from) income taxes
Table	12.3
(In thousands)		2022		2021		2020
Current federal		$	228,259	$	161,055	$	85,574
Deferred federal		(5,235)		4,392		28,244
Other		1,661		1,347		(648)
Provision for income taxes		$	224,685	$	166,794	$	113,170

Current federal income tax payments were $236.5 million, $155.3 million, and $79.6 million in 2022, 2021 and 2020, respectively. At December 31, 2022 we owned $661.7 million of tax and loss bonds.

Table 12.4 reconciles the federal statutory income tax rate to our effective tax provision rate.

Effective tax rate reconciliation
Table	12.4
		2022		2021		2020
Federal statutory income tax rate		21.0	%	21.0	%	21.0	%
Tax exempt municipal bond interest		(0.5)	%	(0.6)	%	(0.9)	%
Other, net		0.1	%	0.4	%	0.1	%
Effective tax rate		20.6	%	20.8	%	20.2	%

We have not recorded any uncertain tax positions during 2022 and 2021 and have no unrecognized tax benefits at December 31, 2022 and December 31, 2021. We recognize interest accrued and penalties related to unrecognized tax benefits in income taxes. The statute of limitations related to the consolidated federal income tax return is closed for all years prior to 2019.