Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

v3.20.4
Income Taxes (Tables)
 12 Months Ended
Dec. 31, 2020
Income Tax Disclosure [Abstract]  
Domestic and Foreign Income Taxes
The following table sets forth components of income before income taxes: 
Year Ended December 31,
  2020 2019 2018
Domestic $ 52,595  $ 34,700  $ 46,542 
Foreign 3,833  1,853  (4,152)
Income before income taxes $ 56,428  $ 36,553  $ 42,390 
Income Tax Provision (Benefit)
The components of the (benefit) provision for income taxes were as follows: 
Year Ended December 31,
  2020 2019 2018
Current income tax (benefit) provision:          
Federal $ (4,566) $ 109  $ (1,888)
State 1,522  474  1,176 
Foreign 298  (1) 30 
Total current (2,746) 582  (682)
Deferred income tax provision (benefit):
Federal 3,655  (4,794) 2,662 
State 2,207  202  2,530 
Foreign (3,610) 262  303 
Total deferred 2,252  (4,330) 5,495 
Total income tax (benefit) provision $ (494) $ (3,748) $ 4,813 
Deferred Income Tax Assets and Liabilities
Deferred tax assets and liabilities consisted of the following:
December 31,
  2020 2019
Deferred income tax assets:      
Compensation accruals $ 2,485  $ 1,745 
Reserves 3,861  2,739 
Other 15,621  9,398 
Net operating losses 14,435  14,355 
Interest rate swaps 2,587  1,604 
Energy efficiency 42,046  35,939 
Interest limitation —  5,148 
Deferred revenue 1,270  1,635 
Gross deferred income tax assets 82,305  72,563 
Valuation allowance (3,877) (8,583)
Total deferred income tax assets $ 78,428  $ 63,980 
Deferred income tax liabilities:
Depreciation $ (66,694) $ (51,579)
Deferred effect of derivative liability (284) (328)
Canadian capital cost, allowance and amortization (2,195) (2,919)
United Kingdom goodwill amortization (732) (781)
Outside basis difference (10,886) (8,488)
Total deferred income tax liabilities (80,791) (64,095)
Deferred income tax liabilities, net $ (2,363) $ (115)
Summary of Valuation Allowance
Our valuation allowance related to the following items:
December 31,
2020 2019
Interest rate swaps (1)
$ 106  $ 122 
Foreign net operating loss (2)
3,479  8,169 
State net operating loss at one of our subsidiaries (3)
292  292 
Total valuation allowance $ 3,877  $ 8,583 
(1) The deferred tax asset represents a future capital loss which can only be recognized for income tax purposes to the extent of capital gain income. Although we anticipate sufficient future taxable income, it is more likely than not that it will not be the appropriate character to allow for the recognition of the future capital loss.
(2) It is more likely than not that we will not generate sufficient taxable income at the foreign subsidiary level to utilize the net operating loss.
(3) It is more likely than not that we will not generate sufficient taxable income at the subsidiary level to utilize the net operating loss.
Summary of Operating Loss Carryforwards
As of December 31, 2020, we had the following tax loss and credit carryforwards to offset taxable income in prior and future years:
Amount Expiration Period
Federal net operating loss carryforwards $ 22,600  Indefinite
State net operating loss carryforwards 40,536 
 Various
Canadian net operating loss carryforwards 23,085 
2028 through 2040
United Kingdom net operating loss carryforwards 4,605  Indefinite
Spain net operating loss carryforwards 2,638 
Indefinite
Total tax loss carryforwards $ 93,464 
Federal Energy Investment and Production tax credit carryforward $ 42,046 
2030 through 2040
Summary of Tax Credit Carryforwards
As of December 31, 2020, we had the following tax loss and credit carryforwards to offset taxable income in prior and future years:
Amount Expiration Period
Federal net operating loss carryforwards $ 22,600  Indefinite
State net operating loss carryforwards 40,536 
 Various
Canadian net operating loss carryforwards 23,085 
2028 through 2040
United Kingdom net operating loss carryforwards 4,605  Indefinite
Spain net operating loss carryforwards 2,638 
Indefinite
Total tax loss carryforwards $ 93,464 
Federal Energy Investment and Production tax credit carryforward $ 42,046 
2030 through 2040
Reconciliation of Effective Tax Rates
The following is a reconciliation of the effective tax rates:
Year Ended December 31,
  2020   2019   2018
Income before (benefit) provision for income taxes $ 56,428    $ 36,553  $ 42,390 
Federal statutory tax expense $ 11,850    $ 7,676  $ 8,902 
State income taxes, net of federal benefit 2,257    2,140  3,071 
Net state impact of deferred rate change (29)   (53) 174 
Non deductible expenses 987    150  982 
Impact of reserve for uncertain tax positions (124) (925) 879 
Stock-based compensation expense (2,922)   (169) (441)
Energy efficiency preferences (8,595)   (12,699) (8,636)
Foreign items and rate differential 160    56  (41)
Redeemable non-controlling interests (767) 1,101  70 
Valuation allowance (4,308) 205  641 
Miscellaneous 997    (1,230) (788)
Total income tax (benefit) provision $ (494)   $ (3,748)   $ 4,813 
Effective tax rate:          
Federal statutory rate expense 21.0  % 21.0  % 21.0  %
State income taxes, net of federal benefit 4.0  % 5.9  % 7.2  %
Net state impact of deferred rate change (0.1) % (0.1) % 0.4  %
Non deductible expenses 1.7  % 0.4  % 2.3  %
Impact of reserve for uncertain tax positions (0.2) % (2.5) % 2.1  %
Stock-based compensation expense (5.2) % (0.5) % (1.0) %
Energy efficiency preferences (15.2) % (34.7) % (20.4) %
Foreign items and rate differential 0.3  % 0.2  % (0.1) %
Redeemable non-controlling interests (1.4) % 3.0  % 0.2  %
Valuation allowance (7.6) % 0.6  % 1.5  %
Miscellaneous 1.8  % (3.6) % (1.8) %
Effective tax rate (0.9) % (10.3) % 11.4  %
Unrecognized Tax Benefits
The following table provides a reconciliation of gross unrecognized tax benefits which are included in other liabilities within the consolidated balance sheets:
Year Ended December 31,
  2020   2019
Balance, beginning of year $ 400  $ 1,600 
Additions for current year tax positions 100  — 
Additions for prior year tax positions 100  — 
Reductions of prior year tax positions —  (1,200)
Balance, end of year $ 600  $ 400