INCOME TAXES |
3 Months Ended |
|---|---|
Jun. 30, 2025 | |
| Income Tax Disclosure [Abstract] | |
| INCOME TAXES | INCOME TAXES As of June 30, 2025 and March 31, 2025, the Company had $1.7 million and $1.1 million of total gross unrecognized tax benefits, including interest, respectively. Of these totals, approximately $1.4 million and $0.9 million, respectively, represents the amount of net unrecognized tax benefits that are permanent in nature and, if recognized, would affect the annual effective tax rate. At June 30, 2025, approximately $0.8 million of gross unrecognized tax benefits are expected to be resolved during the next twelve months through the expiration of the statute of limitations and settlement with taxing authorities. The Company’s continuing practice is to recognize interest and penalties related to income tax matters in income tax expense. The Company had approximately $582.5 thousand accrued for gross interest as of June 30, 2025, and accrued $240.8 thousand during the three months ended June 30, 2025. Investment in HTC was $20.6 million and $15.9 million as of June 30, 2025 and March 31, 2025, respectively, which is included as a component of Other assets, net in the Consolidated Balance Sheets. The Company recognized net amortization from these investments of $3.4 million and $4.1 million during the three months ended June 30, 2025 and 2024, respectively, in income tax expense. The Company recognized tax benefits from these investments of $3.8 million and $4.5 million for the three months ended June 30, 2025 and 2024, respectively, in income tax expense and in Income taxes payable in the Consolidated Statements of Cash Flows. The Company did not recognize any non-tax related activity or have any significant modifications in the investments during the current period. The Company is subject to U.S. income taxes, as well as taxes in various other state and local jurisdictions. With the exception of a few states, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2021, although carryforward attributes that were generated prior to 2021 may still be adjusted upon examination by the taxing authorities if they either have been or will be used in a future period. The Company’s effective income tax rate increased to 30.9% for the three months ended June 30, 2025 compared to 23.1% for the prior year quarter. The Company finalized a settlement with various taxing authorities that resulted in an increase in the reserve under ASC 740-10 (unrecognized tax positions) which is treated as a discrete item in the current quarter, along with a decrease in pretax book income relative to an increase in disallowed executive compensation under Section 162(m) in the current quarter. This was partially offset by the permanent tax benefit related to nonqualified stock option exercises and vesting of restricted stock treated as discrete items in the current quarter.
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