INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2016

Income Tax Disclosure [Abstract]

Schedule of Income Tax Expense (Benefit)

Income tax expense (benefit) consists of the following:

	Year Ended December 31,
	2016		2015			2014
Current:
Federal	$	3,813	$	(2,737	)	$	3,737
State and Local	252		(1,631		)	2,799
Total Current Income Tax Expense (Benefit)	4,065		(4,368		)	6,536
Deferred:
Federal	33,999		(2,778		)	12,853
State and Local	847		(3,855		)	3,568
Total Deferred Income Tax Expense (Benefit)	34,846		(6,633		)	16,421
Total Income Tax Expense (Benefit)	$	38,911	$	(11,001	)	$	22,957

Schedule of Reported Provision for Income Taxes and the U.S. Federal Statutory Rate

The difference between New Residential’s reported provision for income taxes and the U.S. federal statutory rate of 35% is as follows:

	December 31,
	2016		2015		2014
Provision at the statutory rate	35.00	%	35.00	%	35.00	%
Non-taxable REIT income	(28.22	)%	(36.51	)%	(31.12	)%
State and local taxes	0.18	%	(1.16	)%	0.69	%
Other	0.19	%	(1.58	)%	0.37	%
Total provision	7.15	%	(4.25	)%	4.94	%

Schedule of Deferred Tax Assets and Liabilities

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liability are presented below:

	December 31,
	2016			2015
Deferred tax assets:
Servicer Advances basis difference(A)	$	113,354		$	144,842
Net operating losses(B)	44,289			42,944
Deferred deductibility of interest expense	16,543			—
Other	5,684			6,934
Total deferred tax assets	179,870			194,720
Less valuation allowance	(10,054		)	(9,409		)
Net deferred tax assets	$	169,816		$	185,311
Deferred tax liabilities:
Unrealized mark to market	(18,532		)	—
Total deferred tax (liability)	$	(18,532	)	$	—
Net deferred tax assets (liability)	$	151,284		$	185,311

(A) On April 6, 2015, as a part of the purchase price allocation related to the HLSS Acquisition (Note 1), New Residential recorded an increase to its deferred tax asset of $195.1 million. The deferred tax asset primarily relates to the difference in the book basis and tax basis of New Residential’s investment in Servicer Advances. New Residential believes that such deferred tax asset is more likely than not to be realized and, therefore, no valuation allowance has been recorded against such deferred tax asset as of December 31, 2016.

(B) As of December 31, 2016, New Residential’s TRSs had approximately $112.0 million of net operating loss carryforwards for federal and state income tax purposes which may be available to offset future taxable income, if and when it arises. These federal and state net operating loss carryforwards will begin to expire in 2034. The utilization of the net operating loss carryforwards to reduce future income taxes will depend on the TRSs ability to generate sufficient taxable income prior to the expiration of the carryforward period.

Summary of Changes in Deferred Tax Asset Valuation Allowance

The following table summarizes the change in the deferred tax asset valuation allowance:

Valuation allowance at December 31, 2014	$	3,619
Increase related to net operating losses and loan loss reserves	6,680
Other increase (decrease)	(890		)
Valuation allowance at December 31, 2015	9,409
Increase related to net operating losses and loan loss reserves	1,303
Other increase (decrease)	(658		)
Valuation allowance at December 31, 2016	$	10,054

Schedule of the Reconciliation of Unrecognized Tax Benefits

A reconciliation of the unrecognized tax benefits is as follows:

Balance at December 31, 2014	$	2,258
Additions for tax positions of the 2013 tax year	—
Other additions (reductions)	(2,258		)
Balance at December 31, 2015	—
Additions for tax positions of current year	—
Other additions (reductions)	—
Balance at December 31, 2016	$	—

Schedule of Taxable Common Stock Distributions

Common stock distributions were taxable as follows:

Year	Dividends per Share		Ordinary Income		Long-term Capital Gain		Return of Capital
2016(A)	$	1.38	96.13	%	3.87	%	—
2015	1.75		92.92	%	7.08	%	—
2014	1.58		84.78	%	15.22	%	—

(A) The entire $0.46 per share dividend declared in December 2016 and paid in January 2017 is treated as received by stockholders in 2017.