CORVEL CORP Income Taxes Disclosure
Note 6 — Income Taxes
The income tax provision consisted of the following for the fiscal years ended March 31, 2025, 2024 and 2023:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Current — Federal |
|
$ |
23,985,000 |
|
|
$ |
17,463,000 |
|
|
$ |
14,745,000 |
|
Current — State |
|
|
6,833,000 |
|
|
|
4,707,000 |
|
|
|
5,357,000 |
|
Subtotal |
|
|
30,818,000 |
|
|
|
22,170,000 |
|
|
|
20,102,000 |
|
Deferred — Federal |
|
|
(4,594,000 |
) |
|
|
(2,828,000 |
) |
|
|
(1,321,000 |
) |
Deferred — State |
|
|
(565,000 |
) |
|
|
(493,000 |
) |
|
|
(592,000 |
) |
Subtotal |
|
|
(5,159,000 |
) |
|
|
(3,321,000 |
) |
|
|
(1,913,000 |
) |
|
|
$ |
25,659,000 |
|
|
$ |
18,849,000 |
|
|
$ |
18,189,000 |
|
The following is a reconciliation of the income tax provision from the statutory federal income tax rate to the effective rate for the fiscal years ended March 31, 2025, 2024 and 2023:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Income taxes at federal statutory rate |
|
$ |
25,373,000 |
|
|
$ |
19,971,000 |
|
|
$ |
17,757,000 |
|
State income taxes, net of federal benefit |
|
|
4,937,000 |
|
|
|
3,369,000 |
|
|
|
3,890,000 |
|
Uncertain tax positions |
|
|
9,000 |
|
|
|
(22,000 |
) |
|
|
(77,000 |
) |
Stock-based compensation and §162(m) limitation |
|
|
(3,687,000 |
) |
|
|
(3,961,000 |
) |
|
|
(3,098,000 |
) |
Permanent items and tax credits |
|
|
(568,000 |
) |
|
|
(480,000 |
) |
|
|
(384,000 |
) |
Adjustments to returns as filed |
|
|
(420,000 |
) |
|
|
67,000 |
|
|
|
163,000 |
|
Valuation allowance |
|
|
15,000 |
|
|
|
(95,000 |
) |
|
|
(62,000 |
) |
|
|
$ |
25,659,000 |
|
|
$ |
18,849,000 |
|
|
$ |
18,189,000 |
|
Deferred tax assets and liabilities at March 31, 2025 and 2024 are, as follows:
|
|
2025 |
|
|
2024 |
|
||
Deferred tax assets: |
|
|
|
|
|
|
||
Accrued liabilities not currently deductible |
|
$ |
8,363,000 |
|
|
$ |
7,181,000 |
|
Allowance for expected credit losses |
|
|
1,947,000 |
|
|
|
1,076,000 |
|
Stock-based compensation |
|
|
2,808,000 |
|
|
|
2,489,000 |
|
Deferred lease liability |
|
|
7,094,000 |
|
|
|
7,917,000 |
|
Capitalized research and development expenditures |
|
|
5,826,000 |
|
|
|
4,124,000 |
|
Other |
|
|
541,000 |
|
|
|
497,000 |
|
Deferred tax assets |
|
|
26,579,000 |
|
|
|
23,284,000 |
|
Deferred tax liabilities: |
|
|
|
|
|
|
||
Excess of book over tax basis of fixed assets |
|
|
(4,645,000 |
) |
|
|
(5,758,000 |
) |
Intangible assets |
|
|
(4,905,000 |
) |
|
|
(4,922,000 |
) |
Right-of-use asset |
|
|
(5,267,000 |
) |
|
|
(6,075,000 |
) |
Accrued revenue |
|
|
(2,350,000 |
) |
|
|
(2,284,000 |
) |
Other |
|
|
(456,000 |
) |
|
|
(464,000 |
) |
Total deferred tax liabilities |
|
|
(17,623,000 |
) |
|
|
(19,503,000 |
) |
Valuation allowance |
|
|
(252,000 |
) |
|
|
(236,000 |
) |
Deferred tax liabilities |
|
|
(17,875,000 |
) |
|
|
(19,739,000 |
) |
Net deferred tax assets (liabilities) |
|
$ |
8,704,000 |
|
|
$ |
3,545,000 |
|
|
|
|
|
|
|
|
||
Prepaid income taxes are $0 at March 31, 2025, and $2,169,000 at March 31, 2024.
A reconciliation of the financial statement recognition and measurement of uncertain tax positions during the current fiscal year is as follows:
Balance as of March 31, 2024 |
|
$ |
145,000 |
|
Additions based on tax positions related to the current year |
|
|
— |
|
Additions for tax positions of prior years |
|
|
65,000 |
|
Reductions for tax positions related to the current year |
|
|
— |
|
Reductions for tax positions of prior years |
|
|
(47,000 |
) |
Balance as of March 31, 2025 |
|
$ |
163,000 |
|
The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. During the fiscal years ended March 31, 2025, 2024 and 2023, the Company recognized approximately $(9,000), $(14,000) and $(13,000) in interest and penalties, respectively. As of March 31, 2025, 2024 and 2023, accrued interest and penalties related to uncertain tax positions were $31,000, $40,000 and $54,000, respectively.
The tax fiscal years from remain open to examination by the major taxing jurisdictions to which the Company is subject.
Want the next CORVEL CORP income taxes disclosure the moment it drops?
Set a Sentinel and we'll alert you the moment CORVEL CORP's next filing hits EDGAR. No credit card, your email never gets sold.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | May 23, 2025 | Showing above |
| 2024 | May 24, 2024 | |
| 2023 | May 26, 2023 | |
| 2020 | Jun 10, 2020 | |
About Income Taxes Disclosures
The income tax disclosure reveals how much a company actually pays in taxes versus what the statutory rate would predict. Analysts focus on the effective tax rate (ETR) reconciliation, which breaks down every item driving the gap between the 21% federal rate and the company's reported ETR — including R&D credits, foreign rate differentials, and state taxes. Deferred tax assets (DTAs) and their valuation allowances signal management's confidence in future profitability: a rising allowance suggests the company doubts it can use accumulated tax benefits. Uncertain tax benefit (UTB) reserves quantify exposure to IRS challenges on aggressive positions.
Key signals to watch: sudden ETR drops without clear operational reasons, large increases in valuation allowances, growing UTB balances, and significant unremitted foreign earnings. Post-TCJA, pay attention to GILTI and BEAT provisions that affect multinational tax structures. Compare the cash taxes paid (from the cash flow statement) against the income tax provision to gauge earnings quality.