Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Schedule of income tax expense from continuing operations

For the years ended December 31, 2016, 2017, and 2018, income tax expense (benefit) consisted of the following (in thousands):


	Year ended December 31,
	2016		2017		2018
Current income tax expense (benefit)	$	(10,984)		75		—
Deferred income tax benefit		(485,392)		(295,126)		(128,857)
Total income tax benefit	$	(496,376)		(295,051)		(128,857)

Schedule of reconciliation of income tax expense from continuing operations

Income tax expense (benefit) differs from the amount that would be computed by applying the U.S. statutory federal income tax rate of 35% for the years ended December 31, 2016 and 2017, and 21% for the year ended December 31, 2018, to income or loss before taxes as a result of the following (in thousands):


	Year ended December 31,
	2016		2017		2018
Federal income tax expense (benefit)	$	(436,038)		171,530		(36,657)
State income tax expense (benefit), net of federal benefit		(20,364)		10,779		(12,627)
Change in Federal tax rate, net of state benefit (1)		—		(427,962)		—
Change in State tax rate, net of federal effect		—		—		(40,415)
Nondeductible equity-based compensation		3,691		12,098		6,079
Noncontrolling interest in Antero Midstream		(34,780)		(59,523)		(73,881)
Change in valuation allowance		(10,852)		(2,073)		28,116
Other		1,967		100		528
Total income tax benefit	$	(496,376)		(295,051)		(128,857)

⁽¹⁾

The change in the Federal tax rate was due to the passage of Public Law No. 115-97, commonly referred to as the Tax Cuts and Jobs Act. The passage of this legislation resulted in the Company generating a deferred tax benefit in 2017 primarily due to the reduction in the U.S. statutory rate from 35% to 21%.

Schedule of net deferred tax assets and liabilities

The tax effect of the temporary differences giving rise to net deferred tax assets and liabilities at December 31, 2017 and 2018 is as follows (in thousands):


	2017		2018
Deferred tax assets:
Net operating loss carryforwards	$	727,522		734,255
Equity-based compensation		12,062		10,633
Investment in Antero Midstream		38,613		—
Other		11,236		15,726
Total deferred tax assets		789,433		760,614
Valuation allowance		(17,361)		(45,477)
Net deferred tax assets		772,072		715,137
Deferred tax liabilities:
Unrealized gains on derivative instruments		442,855		271,747
Oil and gas properties		1,058,543		1,055,850
Investment in Antero Midstream		—		11,258
Other		50,319		27,070
Total deferred tax liabilities		1,551,717		1,365,925
Net deferred tax liabilities	$	(779,645)		(650,788)