Income Taxes

9 Months Ended

Sep. 30, 2019

Income Tax Disclosure [Abstract]

Income Taxes

INCOME TAXES:

The effective tax rates for the three and nine months ended September 30, 2019 were 25.4% and 22.3%, respectively. The effective tax rate for the nine months ended September 30, 2019 differs from the U.S. federal statutory rate of 21% primarily due to the impact of noncontrolling interest, equity compensation and state income taxes.

The effective tax rates for the three and nine months ended September 30, 2018 were 27.9% and 24.1%, respectively. The effective rate for the nine months ended September 30, 2018 differs from the U.S. federal statutory rate of 21% primarily due to increases for both state income taxes and state valuation allowances, offset by the benefit derived from the filing of a Federal 10-year net operating loss (“NOL”) carryback as well as non-controlling interest.

On December 22, 2017, the United States enacted the Tax Cuts and Jobs Act (the "Act") which, among other things, lowered the U.S. Federal corporate income tax rate from 35% to 21%, repealed the corporate alternative minimum tax ("AMT"), and provided for a refund of previously accrued corporate AMT credits. As of December 31, 2018, the Company reclassified $102,482 from Deferred Income Taxes to Recoverable Income Taxes in the Consolidated Balance Sheets in anticipation of the AMT refund that is also included in the Recoverable Income Taxes line of the Consolidated Statements of Cash Flows in the nine months ended September 30, 2019.

The total amount of uncertain tax positions at each of September 30, 2019 and December 31, 2018 was $31,516. If these uncertain tax positions were recognized, approximately $31,516 would affect CNX's effective tax rate. There were no changes in unrecognized tax benefits during the three and nine months ended September 30, 2019.

CNX recognizes accrued interest related to uncertain tax positions in interest expense. As of September 30, 2019 and December 31, 2018, CNX had no accrued liabilities for interest related to uncertain tax positions.

CNX recognizes penalties accrued related to uncertain tax positions in its income tax expense. As of September 30, 2019 and December 31, 2018, CNX had no accrued liabilities for tax penalties related to uncertain tax positions.

CNX and its subsidiaries file federal income tax returns with the United States and tax returns within various state jurisdictions. With few exceptions, the Company is no longer subject to United States federal, state, local, or non-U.S. income tax examinations by tax authorities for the years before 2016. The Company expects the Internal Revenue Service to conclude its audit of tax years 2016 through 2017 in the second quarter of 2020.