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Income Taxes
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Income tax expense (benefit) is composed of the following:
For the year ended December 31,
20232022
Current:
Federal$— $— 
State32 (2)
Total current expense (benefit)32 (2)
Deferred:
Federal(959)1,051 
State244 27 
Total deferred tax (benefit) expense$(715)$1,078 
Income tax (benefit) expense$(683)$1,076 
The following table presents a reconciliation of the income tax (benefit) expense computed at the U.S. federal statutory rate and the Company’s income tax (benefit) expense:
For the year ended December 31,
20232022
Income tax (benefit) expense – computed as 21% of pretax (loss) income $(5,598)$11,181 
Effect of noncontrolling interests and redeemable noncontrolling interests3,490 691 
State tax, net of federal benefit169 (138)
State valuation allowance73 158 
Transaction costs related to the Merger— (12)
Transaction costs related to the Merger (return to provision)— (678)
Effect of tax credits(254)(75)
Stock-based compensation2,480 1,614 
Change in fair value of redeemable warrant and Alignment Shares liability(1,183)(11,690)
Other140 25 
Income tax (benefit) expense$(683)$1,076 
Effective income tax rate2.6%2.0%
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. As of December 31, 2023 and 2022, the Company’s deferred tax assets and liabilities are comprised of the following:
As of December 31,
20232022
Deferred tax assets:
Net operating losses$86,078 $65,128 
Intangible liabilities397 594 
Deferred financing costs6,334 3,029 
Tax credits945 690 
Operating lease liability24,813 17,830 
Asset retirement obligation4,453 2,490 
Stock-based compensation1,096 609 
Derivative liability1,973 — 
Sec. 163(j) interest limitation27,567 16,749 
Total deferred tax assets$153,656 $107,119 
Valuation allowance(868)(795)
Net deferred tax assets$152,788 $106,324 
Deferred tax liabilities:
Property, plant and equipment$(94,286)$(58,040)
Intangible assets(617)(692)
Operating lease asset(22,224)(16,868)
Derivative asset — (876)
Investments in partnerships(45,492)(40,859)
Total deferred tax liabilities(162,619)(117,335)
Net deferred tax liability$(9,831)$(11,011)

As of December 31, 2023 and 2022, the Company had US federal net operating loss carryforwards of $340.1 million and $262.4 million, respectively, available to offset future federal taxable income which will begin to expire in 2034. The Company has federal net operating loss carryforwards of $303.1 million, which can be carried forward indefinitely. As of December 31, 2023 and 2022, the Company had $47.6 million of US federal net operating loss subject to limitation under Internal Revenue Code Section 382. As of December 31, 2023 and 2022, the Company had state net operating losses of $225.7 million and $155.4 million, respectively, of which $0.2 million will expire in 2024, if not utilized.
The Company regularly assesses the realizability of its deferred tax assets and establishes a valuation allowance if it is more likely than not that some or all of its deferred tax assets will not be realized. The Company evaluates and weighs all available
positive and negative evidence such as historic results, future reversals of existing deferred tax liabilities, projected future taxable income, as well as prudent and feasible tax-planning strategies. As of December 31, 2023 and 2022, the Company has recorded a valuation allowance of $0.9 million and $0.8 million, respectively, for its deferred tax assets associated with state net operating losses that are more likely than not to expire.
As of December 31, 2023 and 2022, the Company had, under IRC Sec. 163(j), a gross interest expense limitation carryforward of $108.5 million and $66.1 million, respectively with an indefinite carryforward period.
The Company applies the applicable authoritative guidance which prescribes a comprehensive model for a manner in which a company should recognize, measure, present and disclose in its financial statements all material uncertain tax positions that the Company has taken or expects to take on a tax return. As of December 31, 2023, the Company has no uncertain tax positions. No amounts of interest and penalties were recognized in the Company’s financial statements and the Company’s policy is to present interest and penalties as a component of income tax expense.
The Inflation Reduction Act (the “IRA Act") was passed into law on August 16, 2022. The key provisions from the IRA include the implementation of a 15% alternative book income minimum tax, an excise tax on stock buybacks, and significant tax incentives for energy and climate initiatives. The Company evaluated the key provisions under the IRA and concluded that the provisions are not applicable for year ended December 31, 2023 and will continue to monitor their impact on future periods.
The Company files federal income tax returns and state income tax returns in multiple jurisdictions. The statute of limitation remains open for tax years after 2014.