Company: PAYC
Filing Date: 2025-02-20
Form Type: 10-K
Source: 0000950170-25-024136
Chunk: 134

Company: Paycom Software, Inc.
Filing Date: 2025-02-20
Form: 10-K
Item: Item 1B
Chunk 134
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 Year Ended December 31,

        2024

        2023

        2022

        Balance at January 1

        Tax positions related to current year:
         
        $
        3.8

        $
        —

        $
        —

        Additions

        0.8

        3.8

        —

        Reductions

        (0.8
        )

        —

        —

        Balance at December 31
         
        $
        3.8

        $
        3.8

        $
        —

      As of December 31, 2024, 2023 and 2022, there were $3.8 million, $3.8 million and $0.0 million, respectively, of unrecognized tax benefits that, if recognized, would affect the annual effective tax rate.Where applicable, we classify income tax-related interest and penalties as interest expense and other expense, respectively. During the years ended December 31, 2024, 2023 and 2022, we recorded interest and penalties with regard to uncertain tax positions of $0.3 million, $0.8 million and $0.0 million, respectively.We recognize tax benefits from an uncertain tax position only if it is more likely than not the tax position will be sustained on examination by taxing authorities based on the technical merits of the position. The tax benefits in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50 percent likelihood of being realized on settlement.We file income tax returns with the United States federal government and various state jurisdictions. With few exceptions, we are no longer subject to U.S. federal, state and local income tax examinations by tax authorities for years prior to 2021.

15.SEGMENT REPORTINGThe Company conducts business as a single operating segment, which is based upon the Company’s current organizational and management structure, as well as information used by the CODM to allocate resources. The Company derives revenues from customers by providing a cloud-based HCM solution delivered as Software-as-a-Service. Our solution is based on a core system of record to maintain a single database for all HCM functions and all of our clients are required to utilize our payroll application. The Company derives revenue primarily in North America and manages the business activities on a consolidated basis. No individual client represents 10% or more of total revenues.The accounting policies of the segment are the same as those described in Note 2 “Summary of Significant Accounting Policies”.