Note 8 - Income Taxes |
3 Months Ended | ||
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Mar. 31, 2021 | |||
| Notes to Financial Statements | |||
| Income Tax Disclosure [Text Block] |
Tax (Benefit) Expense and Tax Rate. Income tax (benefit) expense for the three months ended March 31, 2021 and 2020 was $(0.2) million and $6.5 million, respectively. For the three months ended March 31, 2021, our effective tax rate differed from the statutory Federal tax rate primarily by the impact of state income taxes. For the three months ended March 31, 2020, our effective tax rate primarily differed from the statutory Federal tax rate for adjustments recorded related to the enactment of the CARES Act on March 27, 2020. The CARES Act modified certain income tax statutes, including changes related to the business interest expense limitation under Code Section 163(j). Our effective tax rate was 21.4% for the three months ended March 31, 2021 and 9.0% for the three months ended March 31, 2020.
Valuation Allowance. Deferred tax assets are recorded related to net operating losses and temporary differences between the book and tax basis of assets and liabilities expected to produce tax deductions in future periods. The realization of these assets depends on recognition of sufficient future taxable income in specific tax jurisdictions in which those temporary differences or net operating losses are deductible. In assessing the need for a valuation allowance on our deferred tax assets, we consider whether it is more likely than not that some portion or all of them will not be realized.
As of March 31, 2021 and December 31, 2020, our valuation allowance was $22.0 million and $22.4 million, respectively, and relates primarily to state net operating losses and the disallowed interest expense limitation carryover.
Income Taxes Receivable, Refunds and Payments. As of March 31, 2021 and December 31, 2020, we did have any outstanding current income taxes receivable. As of March 31, 2020, we had current income taxes receivable of $1.9 million, which was received during the quarter ended June 30, 2020. The refund related primarily to a net operating loss carryback claim for 2017 that was carried back to prior years. During the three months ended March 31, 2021 and 2020, we did receive any income tax refunds or make any income tax payments of significance.
The tax years through 2020 remain open to examination by the tax jurisdictions to which we are subject.
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