What was the total provision for income taxes for Management Recruiters on December 31, 2023?
Management_Recruiters Franchise · 2024 FDDAnswer from 2024 FDD Document
determined adversely, will not have a material adverse effect on our business, financial condition or results of operations. There have been no material changes in our legal proceedings as of December 31, 2023.
Note 12 – Income Tax
The provision for income taxes is comprised of the following (in thousands):
| December 31, 2023 | December 31, 2022 |
|---|
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 65–66)
What This Means (2024 FDD)
According to Management Recruiters's 2024 Franchise Disclosure Document, the total provision for income taxes on December 31, 2023, was $1,345. This figure represents the amount Management Recruiters allocated for income taxes during that fiscal year. It's important to note that this is not the actual amount of taxes paid, but rather an accounting estimate of the tax liability.
The provision for income taxes includes both current and deferred taxes. Current taxes are those payable within the current year, while deferred taxes relate to future tax liabilities or assets resulting from temporary differences between book and tax values of assets and liabilities. For December 31, 2023, the current taxes consisted of $1,080 in federal taxes and $614 in state taxes, totaling $1,694. Deferred taxes included a federal component of ($332) and a state component of ($17), totaling ($349).
Understanding the provision for income taxes is crucial for prospective franchisees as it provides insight into Management Recruiters's profitability and tax management strategies. Fluctuations in this provision from year to year, as seen by the $1,895 provision in 2022, can be influenced by changes in income, tax laws, or accounting practices. Franchisees should consider these factors when evaluating the financial health and stability of Management Recruiters.