v3.26.3
Income Taxes
 9 Months Ended
Sep. 30, 2026
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The Company incurs income tax (benefit) expense related to its Taxable Subsidiaries. The components of income tax (benefit) expense were as follows during the quarter and nine months ended September 30, 2026 and 2025 (in thousands):
Quarter Ended September 30,Nine Months Ended September 30,
2026202520262025
Current:
Federal$11 $19 $95 $61 
State2 9 18 14 
Total current tax expense13 28 113 75 
Deferred:
Federal(3,471)3,331 1,452 8,134 
State(280)166 (51)376 
Total deferred tax (benefit) expense(3,751)3,497 1,401 8,510 
Total income tax (benefit) expense $(3,738)$3,525 $1,514 $8,585 
The effective tax rate for the nine months ended September 30, 2026 and 2025 was 1.4% and 8.0%, respectively. The primary items giving rise to the difference between the 21.0% federal statutory rate applicable to corporations and the effective tax rates are state taxes and the benefits of the partnership structure.
Significant components of the Company’s deferred tax assets and liabilities as of September 30, 2026 and December 31, 2025 were as follows (in thousands):
September 30, 2026December 31, 2025
Deferred tax assets:
Carryforwards of net operating loss$4,365 $4,754 
Other— 12 
Valuation allowance(256)(234)
Total deferred tax assets4,109 4,532 
Deferred tax liabilities:
Unrealized appreciation on investments(28,419)(27,441)
Total deferred tax liabilities(28,419)(27,441)
Deferred tax liabilities, net$(24,310)$(22,909)