The U.S. Tax Cuts and Jobs Act (“TCJA") was enacted on December 22, 2017 and introduces significant changes to U.S. income tax law. TCJA includes a broad range of tax reform including changes to tax rates and deductions that were effective January 1, 2018. The decrease in the enacted corporate tax rate to be applied when the temporary differences are realized or settled ultimately resulted in a one-time revaluation of the net deferred tax asset of $3.1 million with a corresponding charge to income tax expense. The effects of TCJA increased income tax expense to a level that reduced net income to a net loss for the twelve months ended March 31, 2018.

The provision for income taxes (income tax benefits) consists of the following for the years ended March 31:

	(In thousands)
	2019			2018
Current:
Federal	$	(39	)	$	1,705
State		(66	)		340
Total current		(105	)		2,045
Deferred:
Federal		(844	)		1,847
State		9			369
Total deferred		(835	)		2,216
Income tax expense (benefit)	$	(940	)	$	4,261

The net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes are reflected in deferred income taxes. Significant components of the Company’s deferred tax assets consist of the following as of March 31:

	(In thousands)
Deferred Tax Assets	2019		2018
Allowance for credit losses not currently deductible for tax purposes	$	4,431	$	5,811
Share-based compensation		276		266
Federal and state net operating loss carryforwards		2,293		—
Other items		201		212
Total deferred tax assets		7,201		6,289

Deferred tax liabilities
Other items		77		—
Total deferred tax liabilities		77		—
Deferred income taxes	$	7,124	$	6,289

The provision (benefit) for income taxes reflects an effective U.S tax rate, which differs from the corporate tax rate for the following reasons:

	(In thousands)
	2019			2018
Provision (benefit) for income taxes at Federal statutory rate	$	(845	)	$	976
Increase (decrease) resulting from:
State income taxes, net of Federal benefit		(206	)		491
Tax Reform – Rate Change		160			3,127
Other		(49	)		(333	)
Income tax expense (benefit)	$	(940	)	$	4,261

The Company’s effective tax rate decreased to 20.5% in fiscal 2019 from 134.7% in fiscal 2018, resulting from TCJA.

Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets. A significant piece of objective positive evidence evaluated was the cumulative pre-tax over the three-year period ended March 31, 2019.

On the basis of this evaluation, as of March 31, 2019, a valuation allowance was not required. The amount of the deferred tax asset considered realizable, however, could be adjusted if estimates of future taxable income are reduced.

The Company has U.S. federal, state, and municipal income tax net operating loss carryforwards of $1.9 million and $0.4 million. The U.S. federal net operating loss carryforward and a portion of the state net operating loss carryforwards will not expire. The remaining state net operating loss carryforwards will begin to expire as of March 31, 2020.

The Company considers the earnings of the Company’s U.S. subsidiaries to be indefinitely invested outside Canada on the basis of estimates that future domestic cash generation will be sufficient to meet future domestic cash needs and the Company’s specific plans for reinvestment of those subsidiary earnings. The Company has not recorded a deferred tax liability related to the Canadian income taxes and U.S. withholding taxes on approximately $3.6 million of undistributed earnings of the U.S. subsidiaries indefinitely invested outside Canada. If the Company decided to repatriate the U.S. earnings, it would need to adjust its income tax provision in the period the Company determined that the earnings will no longer be indefinitely invested outside of Canada.