Annual report pursuant to Section 13 and 15(d)

Income Taxes

v3.10.0.1
Income Taxes
12 Months Ended
Dec. 31, 2018
Income Tax Disclosure [Abstract]  
Income Taxes

Note 4. Income Taxes

The components of the provision for income taxes are as follows:

 

 

 

Year Ended December 31,

 

(In thousands)

 

2018

 

 

2017

 

 

2016

 

Current:

 

 

 

 

 

 

 

 

 

 

 

 

Federal

 

$

113,491

 

 

$

169,053

 

 

$

126,903

 

State

 

 

38,647

 

 

 

25,644

 

 

 

20,111

 

 

 

 

152,138

 

 

 

194,697

 

 

 

147,014

 

Deferred:

 

 

 

 

 

 

 

 

 

 

 

 

Federal

 

 

49,125

 

 

 

(81,551

)

 

 

29,354

 

State

 

 

8,582

 

 

 

(1,088

)

 

 

5,454

 

 

 

 

57,707

 

 

 

(82,639

)

 

 

34,808

 

Total provision for income taxes

 

$

209,845

 

 

$

112,058

 

 

$

181,822

 

 

The Tax Cuts and Jobs Act (the “Tax Act”) was enacted on December 22, 2017. The Tax Act reduced the U.S. federal corporate income tax rate from 35% to 21% and made several other changes to long-held tax rules. An income tax benefit of $104.9 million was recorded in our provision for income taxes in the year ended December 31, 2017 to reflect the estimated impact of the Tax Act on our net deferred tax liabilities. In 2018, we completed our accounting for the effects of the Tax Act and no material changes in our initial estimate were required.

          The following is a reconciliation of income tax expense calculated using the U.S. statutory federal income tax rate with our income tax expense for 2018, 2017 and 2016:

 

 

Year Ended December 31,

 

(In thousands)

 

2018

 

 

2017

 

 

2016

 

Tax provision at statutory rate

 

$

171,258

 

 

$

201,541

 

 

$

167,156

 

State income taxes, net of federal benefit

 

 

36,396

 

 

 

20,277

 

 

 

16,711

 

Revaluation of deferred taxes in connection with the

   Tax Act

 

 

 

 

 

(104,864

)

 

 

 

Other, net

 

 

2,191

 

 

 

(4,896

)

 

 

(2,045

)

Total provision for income taxes

 

$

209,845

 

 

$

112,058

 

 

$

181,822

 

 

Deferred tax assets and liabilities, which are included in “Other assets” and “Deferred income taxes” on our Balance Sheets, consist of the following:

 

 

 

December 31,

 

(In thousands)

 

2018

 

 

2017

 

Deferred tax assets:

 

 

 

 

 

 

 

 

Claims and insurance reserves

 

$

27,433

 

 

$

29,008

 

Accrued vacation

 

 

17,932

 

 

 

17,832

 

Deferred compensation

 

 

31,306

 

 

 

29,220

 

Other

 

 

20,861

 

 

 

15,157

 

Total deferred tax assets

 

 

97,532

 

 

 

91,217

 

 

 

 

 

 

 

 

 

 

Deferred tax liabilities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

(339,311

)

 

 

(266,730

)

Unrecognized revenue

 

 

 

 

 

(10,007

)

Other

 

 

(3,151

)

 

 

(1,703

)

Total deferred tax liabilities

 

 

(342,462

)

 

 

(278,440

)

Net deferred tax liability

 

$

(244,930

)

 

$

(187,223

)

    

We are subject to U.S. federal income tax, as well as income tax of multiple state tax jurisdictions. We remain open to examination by the Internal Revenue Service for tax years 2015 through 2018. We also remain open to examination by various state tax jurisdictions for tax years 2014 through 2018.

The Company’s liability for unrecognized tax benefits was immaterial as of December 31, 2018 and 2017. Interest and penalties related to uncertain tax positions, which are immaterial, are recorded in our “Provision for income taxes” on our Statements of Operations. Changes in our liability for unrecognized tax benefits could affect our effective tax rate, if recognized, but we do not expect any material changes within the next twelve months.