Income Taxes |
9 Months Ended |
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Sep. 30, 2022 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | Note 13 — Income Taxes The Company is a corporation and is subject to U.S. federal income tax. The Company uses an estimated annual effective tax rate for purposes of determining the income tax provision during interim reporting periods. In calculating the estimated annual effective tax rate, the Company considers forecasted annual pre-tax income and estimated permanent book versus tax differences. Adjustments to the effective tax rate and other income tax related estimates could occur during the year as information and assumptions change which could include, but are not limited to, changes to forecasted amounts, estimates of permanent book versus tax differences, and changes to tax laws and rates. The effective U.S. federal income tax rate applicable to the Company for the nine months ended September 30, 2022 and 2021 was 11.6% and (0.2)%, respectively. The Company is subject to the Texas Margin Tax, which requires tax payments at a maximum statutory effective rate of 0.75% on the taxable margin of each taxable entity that does business in Texas. Historically, utilization of a portion of the Company's net operating loss ("NOL") carryforwards has been subject to limitations of utilization under Section 382 of the Internal Revenue Code of 1986, as amended. The Company may be subject to additional limitations due to ownership changes that could occur. The Company reviews changes in the ownership of its shares as such information becomes available to determine whether changes that would result in further limitation have occurred. Given the availability and timing of such ownership information and the underlying analysis required to evaluate such changes, there can be no assurance that existing NOL carry-forwards or credits will not be subject to limitation as of the end of a reporting period. As a result of the initial public offering and subsequent reorganization, and incurred losses, the Company recorded a deferred tax asset. However, a valuation allowance (“VA”) has been recorded to reduce the Company’s net deferred tax assets to an amount that is more likely than not to be realized. The VA is based upon the uncertainty of the realization of certain federal and state deferred tax assets related to net operating loss carryforwards and other tax attributes. Total income tax expense for the three months ended September 30, 2022 and 2021 differed from amounts computed by applying the U.S. federal statutory tax rates to pre-tax income or loss primarily due to the release of the valuation allowance on deferred tax assets, the impact of permanent differences between book and taxable income, and income attributable to noncontrolling interest that is not subject to federal income taxes. The Company is subject to the following material taxing jurisdictions: the United States and Texas. As of September 30, 2022, the Company has no current tax years under audit. The Company remains subject to examination for federal income taxes and state income taxes for tax years 2016 through 2021. The Company has evaluated all tax positions for which the statute of limitations remains open and believes that the material positions taken would more likely than not be sustained upon examination. Therefore, as of September 30, 2022, the Company had not established any reserves for, nor recorded any unrecognized benefits related to, uncertain tax positions. The Coronavirus, Aid, Relief and Economic Security Act (the “CARES Act”), which was enacted on March 27, 2020 in the U.S., includes measures to assist companies, including temporary changes to income and non-income-based tax laws. There have been no material tax impacts to the Condensed Consolidated Financial Statements as it relates to COVID-19 measures. However, the Company has deferred payroll tax payments of $1.1 million as of September 30, 2022 and such amounts are included in Accrued expenses on the Condensed Consolidated Balance Sheet. The Company will continue to monitor additional guidance issued by the U.S. Treasury Department, the Internal Revenue Service and others.
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