Annual report pursuant to Section 13 and 15(d)

DIVIDENDS, DISTRIBUTIONS AND TAXABLE INCOME (Tables)

v3.24.0.1
DIVIDENDS, DISTRIBUTIONS AND TAXABLE INCOME (Tables)
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
Schedule of Distribution To Shareholder The tax character of distributions paid for the years ended December 31, 2023, 2022 and 2021 was as follows:
Year Ended December 31,
2023 2022 2021
(dollars in thousands)
Ordinary income (1) $ 278,165  $ 195,238  $ 129,625 
Qualified dividends 24,100  22,991  47,202 
Distributions on tax basis $ 302,265  $ 218,229  $ 176,827 
___________________________
(1)The years ended December 31, 2023, 2022 and 2021 include $3.3 million, $2.3 million and $1.8 million, respectively, that was reported for tax purposes as compensation for services in accordance with Section 83 of the Code.
Schedule of Taxable Income and To Total Distributions Declared to Common Stock Reconciliation
Listed below is a reconciliation of “Net increase in net assets resulting from operations” to taxable income and to total distributions declared to common stockholders for the years ended December 31, 2023, 2022 and 2021.
Year Ended December 31,
2023 2022 2021
(estimated, dollars in thousands)
Net increase in net assets resulting from operations $ 428,447  $ 241,606  $ 330,762 
Book-tax difference from share-based compensation expense 962  142  (3,213)
Net unrealized appreciation (232,577) (24,816) (135,624)
Income tax provision 22,642  23,325  32,863 
Pre-tax book loss (income) not consolidated for tax purposes 20,726  (37,630) (59,634)
Book income and tax income differences, including debt origination, structuring fees, dividends, realized gains and changes in estimates 72,389  17,043  39,819 
Estimated taxable income (1) 312,589  219,670  204,973 
Taxable income earned in prior year and carried forward for distribution in current year 49,216  50,834  24,359 
Taxable income earned prior to period end and carried forward for distribution next period (76,510) (66,892) (65,994)
Dividend payable as of period end and paid in the following period 20,368  17,676  15,159 
Total distributions accrued or paid to common stockholders $ 305,663  $ 221,288  $ 178,497 
___________________________
(1)MSCC’s taxable income for each period is an estimate and will not be finally determined until MSCC files its tax return for each year. Therefore, the final taxable income, and the taxable income earned in each period and carried forward for distribution in the following period, may be different than this estimate.
Schedule of Components of Income Tax Expense (Benefit) Main Street’s Consolidated Statements of Operations. Main Street’s provision for income taxes was comprised of the following for the years ended December 31, 2023, 2022 and 2021:
Year Ended December 31,
2023 2022 2021
(dollars in thousands)
Current tax expense (benefit):
Federal $ 1,198  $ 516  $ (235)
State 2,245  1,845  3,377 
Excise 3,190  2,838  2,590 
Total current tax expense 6,633  5,199  5,732 
Deferred tax expense:
Federal 14,181  13,176  23,205 
State 1,828  4,950  3,926 
Total deferred tax expense 16,009  18,126  27,131 
Total income tax provision $ 22,642  $ 23,325  $ 32,863 
Schedule of Deferred Tax Assets and Liabilities
The following table sets forth the significant components of net deferred tax assets and liabilities as of December 31, 2023 and 2022:
Year Ended December 31,
2023 2022
(dollars in thousands)
Deferred tax assets:
Net operating loss carryforwards $ 39,079  $ 35,043 
Interest expense carryforwards 20,126  6,171 
Other 4,190  3,401 
Total deferred tax assets 63,395  44,615 
Deferred tax liabilities:
Net unrealized appreciation of portfolio investments (90,981) (64,219)
Net basis differences in portfolio investments (36,272) (28,245)
Total deferred tax liabilities (127,253) (92,464)
Total deferred tax liabilities, net $ (63,858) $ (47,849)