NOTE 14: INCOME TAXES

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of a number of expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for some business provisions. The legislation has multiple effective dates, with some provisions that became effective in 2025 and others that will be implemented through 2027. Provisions effective in 2025 did not have a significant impact on the Company’s operations or financial statements. We continue to assess the expected impact of the OBBBA on our consolidated financial statements in future periods.

All income for the Company is from continuing operations and is from a single country, the United States of America. During the three and six months ended June 30, 2026 and 2025, the components of income tax expense were as follows:

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Reconciliations of the Company’s effective tax rates to the statutory corporate tax rates were as follows for the periods indicated:

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The Company and its consolidated subsidiaries have not been audited recently by the Internal Revenue Service (IRS). As a result, federal tax years through December 31, 2021 are now closed. In addition, there were no pending audits by any state jurisdiction at June 30, 2026.

During the three months ended June 30, 2026, the Company paid $1.2 million in U.S. federal income taxes and paid taxes to various state jurisdictions totaling $855,000. There were no payments to any individual state jurisdiction exceeding five percent of taxable income. During the three months ended June 30, 2025, the Company paid $3.0 million in U.S. federal income taxes and paid taxes to various state jurisdictions totaling $614,000. There were no payments to any individual state jurisdiction exceeding five percent of taxable income. In addition, during the three months ended June 30, 2025, the Company received federal income tax refunds totaling $16,000.

During the six months ended June 30, 2026, the Company paid $1.2 million in U.S. federal income taxes and paid taxes to various state jurisdictions totaling $896,000. There were no payments to any individual state jurisdiction exceeding five percent of taxable income. In addition, during the six months ended June 30, 2026, the Company received a refund of $642,000 from one state jurisdiction and federal income tax refunds totaling $977,000. During the six months ended June 30, 2025, the Company paid $3.0 million in U.S. federal income taxes and paid taxes to various state jurisdictions totaling $649,000. There were no payments to any individual state jurisdiction exceeding five percent of taxable income. In addition, during the six months ended June 30, 2025, the Company received a refund of $19,000 from one state jurisdiction and federal income tax refunds totaling $65,000.

Tax payments made to individual state jurisdictions representing five percent or more of total income taxes paid (net of refunds) in the three months ended June 30, 2026 and 2025, respectively, included: for the 2026 period, Minnesota $215,000, Texas $165,000, Illinois $160,000, Kansas $160,000 and Colorado $155,000; for the 2025 period, Illinois $250,000, Colorado $210,000, Texas $110,000 and Arizona $30,000. Tax payments made to individual state jurisdictions representing five percent or more of total income taxes paid (net of refunds) in the six months ended June 30, 2026 and 2025, respectively, included: for the 2026 period, Minnesota $215,000, Texas $165,000, Illinois $160,000, Kansas $160,000, Colorado $155,000, and Georgia $34,000; for the 2025 period, Illinois $250,000, Colorado $210,000, Texas $110,000, Arizona $30,000 and Georgia $27,000.

During the three and six months ended June 30, 2026 and 2025, the state and local jurisdictions that contributed a majority (totaling greater than 50%) of the effect of the state and local income tax expense included Minnesota, Colorado, and Illinois.