v3.22.4
INCOME TAXES
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
The provision for income taxes for the years ended December 31, 2022, 2021 and 2020 consists of the following:
(thousands) 2022 2021 2020
Current:      
Federal $ 92,783  $ 57,156  $ 16,627 
State 23,724  15,755  8,584 
Foreign 56  (61) 9 
Total current 116,563  72,850  25,220 
Deferred:
Federal (7,348) (1,854) 8,344 
State (2,027) (2,089) (253)
Foreign 26  —  — 
Total deferred (9,349) (3,943) 8,091 
Income taxes $ 107,214  $ 68,907  $ 33,311 
The Company has accounted for in its 2022, 2021, and 2020 income tax provision the impact of Global Intangible Low-Taxed Income, base-erosion anti-abuse tax, interest expense limitations under Section 163(j), and foreign-derived intangible income deductions, although such provisions were either not applicable or resulted in a zero or immaterial impact to the consolidated financial statements.
A reconciliation of the differences between the actual provision for income taxes and income taxes at the federal statutory income tax rate of 21% for the years ended December 31, 2022, 2021, and 2020 is as follows:
(thousands) 2022 2021 2020
Rate applied to pretax income $ 91,436  21.0  % $ 61,598  21.0  % $ 27,377  21.0  %
State taxes, net of federal tax effect 16,715  3.8  % 10,358  3.5  % 6,026  4.6  %
Research and development tax credits (4,542) (1.0) % (1,990) (0.7) % (1,647) (1.3) %
Section 162(m) permanent addback 7,421  1.7  % 5,825  2.0  % 1,951  1.5  %
Excess tax benefit on stock-based compensation (3,292) (0.7) % (6,035) (2.1) % (350) (0.3) %
Other (524) (0.1) % (849) (0.3) % (46) 0.1  %
Income taxes $ 107,214  24.7  % $ 68,907  23.4  % $ 33,311  25.6  %
The composition of the deferred tax assets and liabilities as of December 31, 2022 and 2021 is as follows:  
(thousands) 2022 2021
Deferred tax assets:
Trade receivables allowance $ 1,325  $ 1,022 
Inventory capitalization 4,454  2,393 
Inventory reserves 8,318  6,413 
Federal NOL carryforwards 736  997 
State NOL carryforwards 572  911 
Accrued expenses 27,865  19,793 
Deferred compensation 625  578 
Operating lease liabilities 41,739  40,751 
Share-based compensation 7,921  6,753 
Capitalized research & experimentation costs 14,037  — 
Total deferred tax assets before valuation allowance 107,592  79,611 
Less: valuation allowance (459) (712)
Total deferred tax assets, net of valuation allowance $ 107,133  $ 78,899 
Deferred tax liabilities:
Prepaid expenses (2,939) (2,955)
Operating lease right-of-use assets (40,980) (40,082)
Depreciation expense (47,050) (43,124)
Intangibles (64,012) (29,422)
Other (544) 231 
Total deferred tax liabilities $ (155,525) $ (115,352)
Net deferred tax liabilities $ (48,392) $ (36,453)
Cash paid by the Company for income taxes was $117.1 million, $46.2 million and $7.9 million in 2022, 2021 and 2020, respectively.
As of December 31, 2022 and December 31, 2021, the Company had gross federal, state, and foreign net operating losses, of approximately $17.6 million and $25.5 million, respectively. These loss carryforwards generally expire between tax years ending December 31, 2023 and December 31, 2041. The components of the valuation allowance relate to certain acquired federal, state and foreign net operating loss carryforwards that the Company anticipates will not be utilized prior to their expiration, either due to income limitations or limitations under Section 382 of the Internal Revenue Code of 1986. The tax effected values of these net operating losses are $1.3 million and $1.9 million at December 31, 2022 and 2021, respectively, exclusive of valuation allowances of $0.5 million and $0.7 million at December 31, 2022 and 2021, respectively.
The Company is subject to periodic audits by domestic tax authorities. For the majority of tax jurisdictions, the U.S. federal statute of limitations remains open for the years 2020 and later. Uncertain tax benefits were immaterial at December 31, 2022 and 2021 and activity related to uncertain tax benefits was immaterial for all periods presented.