INCOME TAXES

PBF Energy

For periods following PBF Energy’s IPO, PBF Energy is required to file federal and applicable state corporate income tax returns and recognizes income taxes on its pre-tax income, which to-date has consisted primarily of its share (approximately 24.4% prior to the Secondary Offering and approximately 40.9% subsequent to the Secondary Offering) of PBF LLC’s pre-tax income. PBF LLC is organized as a limited liability company which is treated as a "flow-through" entity for income tax purposes and therefore is not subject to income taxes. As a result, the PBF Energy consolidated financial statements do not reflect a benefit or provision for income taxes for PBF LLC for periods prior to the IPO or any benefit or provision for income taxes on the pre-tax income or loss attributable to the noncontrolling interest in PBF LLC.

The income tax provision in the PBF Energy consolidated financial statements of operations consists of the following:



	Year Ended December 31, 2013		Year Ended December 31, 2012
Current expense:
Federal	$	—	$	—
State	—		—

Total current	—		—

Deferred expense:
Federal	15,406		1,134
State	1,275		141

Total deferred	16,681		1,275

Total provision for income taxes	$	16,681	$	1,275

The difference between the PBF Energy’s effective income tax rate and the United States statutory rate is reconciled below:



	Year Ended December 31, 2013		Year Ended December 31, 2012

Provision at Federal statutory rate	35.0	%	35.0	%
Increase (decrease) attributable to flow-through of certain tax adjustments:
State income taxes (net of federal income tax)	5.0	%	4.4	%
Non deductible/nontaxable items	7.0	%	—	%
Adjustment to deferred tax assets and liabilities for change in tax rates due to business mix	(14.5	)%	—	%
Other	(2.8	)%	0.1	%
Effective tax rate	29.7	%	39.5	%

A summary of the components of deferred tax assets and deferred tax liabilities follows:



	December 31, 2013		December 31, 2012
Deferred tax assets
Purchase interest step-up	$	310,132	$	181,257
Net operating loss carry forwards	14,327		6,087
Other	21,423		9,503

Total deferred tax assets	345,882		196,847
Valuation allowances	—		—

Total deferred tax assets, net	345,882		196,847

Deferred tax liabilities
Property, plant and equipment	140,330		69,088
Inventory	9,390		6,534
Other	1,399		646

Total deferred tax liabilities	151,119		76,268

Net deferred tax assets (liabilities)	$	194,763	$	120,579

PBF Energy has federal and state income tax net operating loss carry forwards of $37,139 and $23,641, respectively, which will expire at various dates from 2022 through 2033.

Income tax years that remain subject to examination by material jurisdictions, where an examination has not already concluded are all years including and subsequent to:



United States
Federal	2012
New Jersey	2012
Michigan	2012
Delaware	2012
Indiana	2012
Pennsylvania	2012
New York	2012

PBF Energy does not have any unrecognized tax benefits.

PBF Holding

PBF Holding is a limited liability company treated as a "flow-through" entity for income tax purposes. Accordingly there is no benefit or provision for federal or state income tax in the accompanying PBF Holding financial statements.