Annual report pursuant to Section 13 and 15(d)

DIVIDENDS, DISTRIBUTIONS AND TAXABLE INCOME (Tables)

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DIVIDENDS, DISTRIBUTIONS AND TAXABLE INCOME (Tables)
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
Schedule of Investment Company, Distribution To Shareholders
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) $ 47,756  $ 61,854  $ 29,797 
Qualified dividends 8,301  1,727  92 
Distributions on tax basis $ 56,057  $ 63,581  $ 29,889 
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 $ 66,209  $ 45,588  $ 73,636 
Net unrealized (appreciation) depreciation (46,319) 1,702  (25,095)
Income tax provision 3,769  1,643  1,890 
Pre-tax book (income) loss not consolidated for tax purposes 4,241  (9,748) (17,640)
Book income and tax income differences, including debt origination, structuring fees, dividends, realized gains and changes in estimates 22,228  9,820  3,171 
Estimated taxable income (1) 50,128  49,005  35,962 
Taxable income earned in prior year and carried forward for distribution in current year 20,674  23,276  29,173 
Taxable income earned prior to period end and carried forward for distribution next period (28,764) (33,491) (35,250)
Dividend accrued as of period end and paid in the following period 14,019  12,817  11,974 
Taxable income earned to be carried forward (14,745) (20,674) (23,276)
Total distributions accrued or paid to common stockholders $ 56,057  $ 51,607  $ 41,859 
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(1)MSIF’s taxable income for each period is an estimate and will not be finally determined until MSIF 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 Provision for Income Taxes MSC Income Fund’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:
Federal $ 13  $ 33  $ — 
State 340  495  495 
Excise 519  753  1,395 
Total current tax expense 872  1,281  1,890 
Deferred tax expense (benefit):
Federal 3,450  351  — 
State (553) 11  — 
Total deferred tax expense 2,897  362  — 
Total income tax provision $ 3,769  $ 1,643  $ 1,890 
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 $ 671  $ 398 
Interest expense carryforwards 3,258  1,426 
General business and foreign tax credit carryforwards 329  156 
Capital loss carryforwards 6,041  10,013 
Total deferred tax assets 10,299  11,993 
Deferred tax liabilities:
Net basis differences in portfolio investments (1,484) (3,777)
Net unrealized appreciation of portfolio investments (12,074) (8,578)
Total deferred tax liabilities (13,558) (12,355)
Total deferred tax liabilities, net $ (3,259) $ (362)