Income Taxes

12 Months Ended

Dec. 31, 2022

Income Tax Disclosure [Abstract]

Income Taxes

The provision for income taxes for consists of the following (in millions):

	Year Ended December 31,
	2022		2021		2020
Current:
Federal	$	44.4	$	43.6	$	44.9
State	15.8		15.5		15.5
Foreign	4.9		3.0		1.7
	65.1		62.1		62.1
Deferred:
Federal and State	31.6		19.5		1.8
	$	96.7	$	81.6	$	63.9

Income from continuing operations before income taxes consists of the following (in millions): 

	Year Ended December 31,
	2022		2021		2020
United States	$	347.6	$	304.5	$	237.6
Foreign	16.0		8.9		3.9
	$	363.6	$	313.4	$	241.5

The components of deferred tax (liabilities) assets are as follows (in millions):

	December 31,
	2022		2021
Intangibles	$	(159.9)	$	(127.5)
Depreciation expense	(8.8)		(11.4)
Operating lease right-of-use assets	(11.8)		(14.8)
Operating lease liabilities	12.2		15.6
Allowance for doubtful accounts	1.3		1.5
Employee-related accruals	21.0		20.5
Stock-based compensation	11.1		10.0
Payroll tax deferral	—		10.5
Other	5.7		6.6
	$	(129.2)	$	(89.0)

The reconciliation between the amount computed by applying the U.S. federal statutory tax rate of 21 percent to income before income taxes and the income tax provision is as follows (in millions):

	Year Ended December 31,
	2022		2021		2020
Income tax provision at the statutory rate	$	76.3	$	65.8	$	50.7
State income taxes, net of federal benefit	17.3		15.2		12.7
Nondeductible executive compensation	5.4		3.3		1.3
Disallowed meals and entertainment expenses	0.5		0.2		0.5
Excess stock-based compensation benefit	(3.5)		(2.0)		(1.1)
Work opportunity tax credit	(2.1)		(3.1)		(2.0)
Other	2.8		2.2		1.8
	$	96.7	$	81.6	$	63.9

As of December 31, 2022, the Company had $0.5 million domestic credit carryforwards and had $1.6 million of foreign net operating losses, which will start to expire in 2030. The Company has recorded a valuation allowance of approximately $0.9 million at December 31, 2022 related to credits and net operating loss carryforwards.

At December 31, 2022, the Company had undistributed earnings of foreign subsidiaries of approximately $16.2 million, substantially all of which are permanently reinvested. The Company will repatriate a portion of these foreign earnings in situations it deems advantageous for business operations, tax or cash management reasons. In doing so, the Company could be subject to state income and foreign taxes which would be insignificant. The determination of the amount of unrecognized deferred income tax liability for any basis differences on the permanently reinvested foreign earnings is not practicable due to the complexities associated with this hypothetical calculation.

The Company had gross deferred tax assets of $59.3 million and $71.7 million and gross deferred tax liabilities of $187.6 million and $160.4 million at December 31, 2022 and 2021, respectively. Management has determined the gross deferred tax assets are realizable.

At December 31, 2022 and 2021, there were $1.4 million and $1.3 million of unrecognized tax benefits, respectively, and changes during those years were not significant. If recognized, these unrecognized tax benefits would affect the annual effective tax rate. The gross unrecognized tax benefits are included in other long-term liabilities in the accompanying consolidated balance sheets. The Company recognizes interest and penalties related to uncertain tax positions in income tax expense in the accompanying consolidated statements of operations and comprehensive income. The amount of interest and penalties recognized in the consolidated financial statements is not significant. The Company believes that there will be no significant decrease in unrecognized tax benefits by the end of 2023.

The Company is subject to taxation in the United States and various states and foreign jurisdictions. The IRS has completed an examination of the Company's U.S. income tax return for the 2018 tax year with no change. The Company remains subject to U.S. federal income tax examinations for 2019 and subsequent years. For the majority of U.S. states, with few exceptions and generally for the foreign tax jurisdictions, the Company remains subject to examination for 2018 and subsequent years.