FRP HOLDINGS, INC.FRPH

FRP HOLDINGS, INC. Income Taxes Disclosure

10-KFiled Apr 15, 20263 min read
Income Taxes.
The provision for income tax expense included in the financial statements (in thousands):
Years Ended December 31,
202520242023
Included in Net income:
Continuing operations$818 2,029 1,516 
Comprehensive income(10)39 551 
Total tax expense$808 2,068 2,067 
The provision for income taxes (income tax benefit) consists of the following (in thousands):
Year Ended December 31,
202520242023
Current:
Federal$1,309 3,245 2 
State287 591 570 
1,596 3,836 572 
Deferred(778)(1,807)944 
Total$818 2,029 1,516 
The deferred taxes are primarily related to the bonus depreciation on property placed in service.
As of December 31, 2025 the Company has deferred taxes of approximately $31 million associated with $112 million of gains on sales reinvested through Opportunity Zone investments. These taxes are deferred until the earlier of the sale of the related investments or April 15, 2027 and 10% of gains are excluded from tax once the investments are held five years plus an additional 5% is excluded at seven years.
A reconciliation between the amount of tax shown above and the amount computed at the statutory Federal income tax rate (in thousands) in addition to the resulting effective tax rates:
Year Ended December 31
2025%2024%2023%
Amount computed at statutory
U.S. federal statutory tax rate
$871 21.0 %1,768 21.0 %1,431 21.0 %
State income taxes (net of Federal income tax benefit)16 0.4 %376 4.5 %39 0.6 %
Nontaxable or nondeductible items
(10)(0.3)%(47)(0.6)%(84)(1.3)%
Other adjustments:
   Provision to return and deferred true-ups
(59)(1.4)%(40)(0.5)%131 1.9 %
    Other items
— — %(28)(0.3)%(1)— %
Provision for income taxes$818 19.7 %2,029 24.1 %1,516 22.2 %

State taxes in District of Columbia, Florida, Georgia, and Maryland made up the majority (greater than 50%) of the tax effect in the State income taxes (net of Federal income tax benefit) category. The effective state income tax rate in each year was favorably impacted both by apportioned interest income in Florida and taxable losses in states with higher income tax rates. The table above has been restated retrospectively to reflect the adoption of ASU No. 2023-09, Improvements to Income Tax Disclosures (Topic 740).
The types of temporary differences and their related tax effects that give rise to deferred tax assets and deferred tax liabilities are presented below (in thousands):
December 31,
202520242023
Deferred tax liabilities:
Property and equipment$36,756 36,868 42,317 
Investment in Opportunity Zone31,075 31,088 34,966 
Depletion597 596 706 
Unrealized rents286 269 385 
Prepaid expenses and other208 218 256 
Gross deferred tax liabilities68,922 69,039 78,630 
Deferred tax assets:
Federal tax loss carryforwards— — 3,153 
State tax loss carryforwards1,474 1,351 6,012 
Transaction costs and other
548 — 9 
Gross deferred tax assets2,022 1,351 9,174 
Net deferred tax liability$66,900 67,688 69,456 
Years Ended
Other Items - All Gross12/31/202512/31/2024
State NOL Carryovers16,466 16,002 
Federal NOL Carryovers— — 
The Company has no unrecognized tax benefits. The federal and state income taxes paid each year are presented on the Consolidated Statements of Cash Flows. No state taxes paid exceeded 5% of total payments in any year except in 2023 which included $90,000 payments to Maryland and $295,000 payments to Georgia.
FRP tax returns in the U.S. and various states that include the Company are subject to audit by taxing authorities. As of December 31, 2025, the earliest tax year that remains open for audit is 2020. Our effective income tax expense may vary, possibly materially, due to projected effective state tax rates.

Historical Timeline

Fiscal YearFiled
2025Apr 15, 2026Showing above
2024Mar 18, 2025
2023Mar 26, 2024
2022Mar 23, 2023
2021Mar 30, 2022
2020Mar 19, 2021
2019Mar 12, 2020
2018Mar 15, 2019
2017Mar 16, 2018
2016Dec 12, 2016
2015Dec 11, 2015

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.

Other Available Disclosures

Earnings Per ShareFair ValueGoodwill & IntangiblesLeasesSegmentsDebtCommitmentsNew Standards