Company: PAMT
Filing Date: 2025-03-12
Form Type: 10-K
Source: 0001437749-25-007273
Chunk: 372

Company: PAMT CORP
Filing Date: 2025-03-12
Form: 10-K
Item: Item 3
Chunk 372
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   Prepaid Tires– Tires purchased with revenue equipment are capitalized as a cost of the related equipment. Replacement tires are included in prepaid expenses and deposits and are amortized over a 24-month period. Amounts paid for the recapping of tires are expensed when incurred.
    
   Advertising Expense– Advertising costs are expensed as incurred and totaled approximately $1,359,000, $2,014,000 and $2,101,000 for the years ended  December 31, 2024, 2023 and 2022, respectively.
    
   Repairs and Maintenance– Repairs and maintenance costs are expensed as incurred.
    
   Self-Insurance Liability– A liability is recognized for known health, workers’ compensation, cargo damage, property damage, and auto liability damage claims. An estimate of the incurred but not reported claims for each type of liability is made based on historical claims made, estimated frequency of occurrence, and considering changing factors that contribute to the overall cost of insurance. See Note 6 – Claims Liabilities for more information regarding insurance and claims liability.
    
   Income Taxes– The Company applies the asset and liability method of accounting for income taxes, under which deferred taxes are determined based on the temporary differences between the financial statement and tax basis of assets and liabilities using tax rates expected to be in effect during the years in which the basis differences reverse. A valuation allowance is recorded when it is more likely than not that some or all of the deferred tax assets will not be realized. See Note 12 – Federal and State Income Taxes for more information regarding income taxes.
    
   The application of income tax law to multi-jurisdictional operations such as those performed by the Company is inherently complex. Laws and regulations in this area are voluminous and often ambiguous. As such, we  may be required to make subjective assumptions and judgments regarding our income tax exposures. Interpretations of and guidance surrounding income tax laws and regulations  may change over time which could cause changes in our assumptions and judgments that could materially affect amounts recognized in the consolidated financial statements.
    
   We recognize the impact of tax positions in our financial statements. These tax positions must meet a more-likely-than-not recognition threshold to be recognized and tax positions that previously failed to meet the more-likely-than-not threshold are recognized in the first subsequent financial reporting period in which that threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not threshold are derecognized in the first