Income Taxes

6 Months Ended

Jun. 30, 2023

Income Tax Disclosure [Abstract]

Income Taxes

Note 4 - Income Taxes

The provision for income taxes for the three and six months ended June 30, 2023, and 2022, consists of the following:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2023			2022			2023			2022
	(in thousands)
Current portion of income tax (expense) benefit:
Federal	$	2,189		$	(3,664)		$	(2,809)		$	(4,273)
State	(3)			(2,047)			(543)			(2,351)
Deferred portion of income tax expense	(44,278)			(81,000)			(94,246)			(92,948)
Income tax expense	$	(42,092)		$	(86,711)		$	(97,598)		$	(99,572)
Effective tax rate	21.9		%	21.1		%	21.9		%	21.1		%

Recorded income tax expense or benefit differs from the amount that would be provided by applying the statutory United States federal income tax rate to income or loss before income taxes. These differences primarily relate to the effect of state income taxes, excess tax benefits and deficiencies from stock-based compensation awards, tax deduction limitations on the compensation of covered individuals, changes in valuation allowances, the cumulative effect of other smaller permanent differences, and can also reflect the cumulative effect of an enacted tax rate change, in the period of enactment, on the Company’s net deferred tax asset and liability balances. The quarterly effective tax rate and the resulting income tax expense or benefit can also be affected by the proportional effects of forecast net income or loss and the correlative effect on the valuation allowance for each of the periods presented in the table above.

The Company commissioned a multi-year research and development (“R&D”) credit study in 2022, which is expected to be completed in late 2023, and is expected to favorably impact the Company’s effective tax rate and future tax obligations when the results are recorded. The Company’s policy is to not record an R&D credit until it is claimed on a filed tax return, which has not occurred as of the filing of this report.

The Company made $6.1 million of cash tax payments during the second quarter of 2023, primarily related to Texas franchise taxes.

For all years before 2019, the Company is generally no longer subject to United States federal or state income tax examinations by tax authorities.