Annual report pursuant to Section 13 and 15(d)

Income Taxes

v3.22.4
Income Taxes
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
We are subject to U.S. federal income tax as well as income tax in multiple state and local jurisdictions. We have concluded all U.S. federal income tax matters as well as material state and local tax matters for years through 2017.

We file consolidated federal income tax returns that include all of our U.S. subsidiaries. The components of the provision for income taxes from continuing operations for the years ended December 31, 2022, 2021 and 2020 were as follows (in thousands):
  2022 2021 2020
Current:
Federal $ 8,880  $ 3,919  $ 4,086 
State 1,411  856  1,262 
Foreign 35  1,066  144 
  10,326  5,841  5,492 
Deferred:      
Federal (1,050) (3,318) (78)
State (89) (1,038) 163 
Foreign —  —  21 
  (1,139) (4,356) 106 
Provision for income taxes $ 9,187  $ 1,485  $ 5,598 
The differences between the amount of tax computed at the federal statutory rate of 21% in 2022, 2021 and 2020, and the provision for income taxes from continuing operations for the years ended December 31, 2022, 2021 and 2020 were as follows (in thousands):
  2022 2021 2020
Tax at statutory federal income tax rate $ 7,822  $ 1,985  $ 89 
Increases (decreases) in tax resulting from:      
State taxes, net of federal tax benefit 1,523  383  (52)
Permanent differences, net (52) (839) (1,406)
Tax credits (579) (434) (195)
Prior year true-up adjustment 189  83  397 
Valuation allowance 338  331  6,716 
Other provision adjustments (54) (24) 49 
Provision for income taxes $ 9,187  $ 1,485  $ 5,598 


The tax effect of temporary differences representing deferred tax assets and liabilities as of December 31, 2022 and 2021 was as follows (in thousands):
  2022 2021
Deferred compensation and accrued paid leave $ 4,552  $ 5,422 
Accrued Expense 1,158  — 
Inventory reserve 12,984  12,465 
Operating Lease Liabilities 9,840  7,805 
Stock-based compensation 942  775 
Interest rate swaps —  58 
Capitalized inventory 1,128  900 
US operating and capital loss carryforward 6,040  6,045 
Tax credit carryforward 1,537  1,411 
Foreign country operating loss carryforward 749  892 
Other 278  — 
39,208  35,773 
Valuation allowance (1)
(8,337) (8,257)
    Total gross deferred tax assets 30,871  27,516 
Interest rate swaps (1,652) — 
Depreciation (3,017) (3,895)
Deferred revenues (1,087) (1,358)
Goodwill and intangible assets (26,226) (24,836)
Operating Lease Right-of-Use Assets (8,510) (6,375)
Other —  (160)
    Total gross deferred tax liabilities (40,492) (36,624)
Net deferred tax liabilities $ (9,621) $ (9,108)
(1) A valuation allowance was provided against US capital loss in connection with the stock sale of Prime Turbines, certain state net operating loss, tax credit, and foreign tax loss deferred tax assets arising from carryforwards of unused tax benefits.
(2) Certain amounts from prior year have been reclassified to conform with current year presentation.

We file income tax returns in the U.S. federal jurisdiction and in various state and foreign jurisdictions. With few exceptions, the statute of limitations for these jurisdictions is no longer open for audit or examinations for the years before 2018.
As of December 31, 2022, we have various tax losses and tax credits that may be applied against future taxable income. The majority of such tax attributes will expire in 2026 through 2034; however, some may be carried forward indefinitely.