INCOME TAXES |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2026 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| INCOME TAXES | INCOME TAXES
Components of the provision for income taxes are as follows (in thousands):
The effective tax rate for the three months ended March 31, 2026 and 2025 was 23.7% and 23.3%, respectively.
At March 31, 2026 and December 31, 2025, we have no unrecognized tax benefits. We believe our current income tax filing positions and deductions will be sustained on audit and we do not anticipate any adjustments that will result in a material change. Our policy is to accrue interest and penalties on unrecognized tax benefits and include them in the provision for income taxes.
We determine our deferred tax assets and liabilities in accordance with ASC 740, Income Taxes. We evaluate our deferred tax assets, including the benefit from net operating losses ("NOLs"), by jurisdiction to determine if a valuation allowance is required. This evaluation considers, among other matters, the nature, frequency and severity of cumulative losses, forecasts of future profitability, the length of statutory carryforward periods, experiences with operating losses and experiences of utilizing tax credit carry forwards and tax planning alternatives. We have no federal NOLs or credit carryovers, and determined that no valuation allowance on our deferred tax assets is necessary at March 31, 2026.
At March 31, 2026, we had $2.2 million taxes payable and no income taxes receivable. The taxes payable at March 31, 2026 primarily consists of income tax liability accrued in excess of federal and state estimated tax payments and energy tax credits. We have accrued taxes of $13.2 million recorded in Accrued and other liabilities on the accompanying unaudited consolidated balance sheets at March 31, 2026 that consists primarily of state franchise tax and federal excise tax.
We conduct business and are subject to tax in the U.S. both federally and in several states. With few exceptions, we are no longer subject to U.S. federal, state, or local income tax examinations by taxing authorities for years prior to 2021. We have no federal tax examinations pending resolution at this time, and one state income tax examination covering various years pending resolution at this time.
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