Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Schedule of components of the Company's income tax expense

The components of the Company’s income tax expense from operations for the year ended December 31, consisted of (in thousands):


	2017		2016		2015
Current:
Federal	$	26,730	$	468	$	139
State		5,632		1,259		1,398
Deferred:
Federal		92,441		4,045		(162)
State		32,179		135		(19)
Income tax expense	$	156,982	$	5,907	$	1,356

Schedule of reconciliation of income tax expense from operations to the federal statutory rate

A reconciliation of income tax expense from operations to the federal statutory rate for the year ended December 31, is as follows (in thousands):


	2017		2016		2015
Income taxes computed at federal statutory rate(1)	$	136,485	$	73,200	$	61,161
State income taxes – net of federal benefit(1)		13,723		7,347		7,196
Other differences:
Federal alternative minimum tax and state and local taxes on pass-through entities		1,072		1,013		1,179
Income taxes computed at the effective federal and state statutory rate for pass-through entities not subject to tax for the Company (2)		(86,200)		(76,702)		(68,940)
Increase in valuation allowance		11,194		1,049		735
Impact of 2017 Tax Act (3)		79,987		—		—
Other		721		—		25
Income tax expense	$	156,982	$	5,907	$	1,356

⁽¹⁾

Federal and state tax for 2017 include the tax effect of $38,399 relating to the reduction in the Tax Receivable Agreement liability.

⁽²⁾

The related income is taxable to the noncontrolling interest for periods after the Company’s IPO and taxable to the holders of membership units prior to the Company’s IPO.

⁽³⁾

Excludes the tax effect of $38,399 for 2017 relating to the reduction in the Tax Receivable Agreement liability, which is included in federal and state tax.

Summary of significant items comprising the net deferred tax asset

Significant items comprising the net deferred tax assets at December 31, were (in thousands):


	2017		2016
			Restated
Deferred tax liabilities
Accelerated depreciation	$	(8,227)	$	(4,655)
Prepaid expenses		(289)		(358)
Other		(293)		(57)
		(8,809)		(5,070)
Deferred tax assets
Investment impairment		20,674		30,680
Gift cards		710		969
Deferred revenues		304		355
Accrual for employee benefits and severance		1,166		1,246
Stock option expense		209		55
Investment in partnership		208,167		116,318
Tax Receivable Agreement liability		34,802		7,387
AMT credit		584		1,049
Net operating loss carryforward		16,733		8,512
Claims reserves		420		547
Intangible assets		108		70
Goodwill		996		1,898
Deferred book gain		813		1,337
Other reserves		5,380		5,339
		291,066		175,762
Valuation allowance		(126,706)		(146,259)
Net deferred tax assets	$	155,551	$	24,433