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Taxes
3 Months Ended
Mar. 31, 2021
Taxes [Abstract]  
Taxes
(7)  Taxes:

The Company uses the estimated annual effective tax rate method for calculating its tax provision in interim periods, which represents the Company’s best estimate of the effective tax rate expected for the full year based on projected annual taxable income (loss).  The effective tax rate can fluctuate throughout the year because estimates used in the quarterly tax provision are updated as more information becomes available throughout the year.

The effective federal tax rate on consolidated income for the three months ended March 31, 2021 was 20.9% compared to 11.9% on consolidated loss for the three months ended March 31, 2020.  The pre-tax loss for the three months ended March 31, 2020 makes these interim period effective tax rates less comparable year-over-year.  The difference in the effective federal income tax rate from the normal statutory rate in the three months ended March 31, 2021 was primarily related to the effects of tax-exempt investment income and the dividends received deduction.  The difference in the effective federal income tax rate from the normal statutory rate in the three months ended March 31, 2020 was primarily related to the recording of a valuation allowance on the Company's deferred tax assets in that period, in addition to the effects of tax-exempt investment income and the dividends received deduction.

In assessing the valuation of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income or availability to carryback the losses to taxable income during the periods in which those temporary differences become deductible.  As of March 31, 2021 and December 31, 2020, the Company had no valuation allowance.

In response to the COVID-19 pandemic, the Coronavirus Aid, Relief, and Economic Security Act of 2020, as amended (the “CARES Act”), was signed into law on March 27, 2020, to provide national emergency economic relief measures.  The CARES Act, among other things, permits net operating loss (“NOL”) carryovers and carrybacks to offset 100% of taxable income for taxable years beginning before 2021. In addition, the CARES Act allows NOLs incurred in 2018, 2019, and 2020 to be carried back to each of the five preceding taxable years to generate a refund of previously paid income taxes. The Company has evaluated the impact of the CARES Act and has determined it did not have a material impact on the Company's results of operations.

As of March 31, 2021, the Company's calendar years 2020, 2019, 2018 and 2017 remain subject to examination by the Internal Revenue Service.