(6) INCOME TAXES

Income tax expense (benefit) was as follows (dollars in thousands):

		Three Months Ended June 30,						Six Months Ended June 30,
		2017			2016			2017			2016
Income tax expense (benefit)	$	57,651		$	(129,488	)	$	170,046		$	(171,464	)
Effective tax rate		45.3	%		36.5	%		41.5	%		35.0	%

We compute our quarterly taxes under the effective tax rate method based on applying an anticipated annual effective rate to our year-to-date income, except for discrete items. Income taxes for discrete items are computed and recorded in the period that the specific transaction occurs. For second quarter and six months ended June 30, 2017 and 2016, our overall effective tax rate was different than the federal statutory rate of 35% due primarily to state income taxes and other tax items which are detailed below (dollars in thousands).

		Three Months Ended June 30,						Six Months Ended June 30,
		2017			2016			2017			2016
Total income (loss) before income taxes	$	127,201		$	(354,424	)	$	409,707		$	(490,172	)
U.S. federal statutory rate		35	%		35	%		35	%		35	%
Total tax expense (benefit) at statutory rate		44,520			(124,048	)		143,397			(171,560	)

State and local income taxes, net of federal benefit		4,146			(11,524	)		13,128			(15,956	)
Non-deductible executive compensation		—			446			140			682
Tax less than book equity compensation		2,228			64			4,752			5,330
Change in valuation allowances:
Federal net operating loss carryforwards & other		2,562			3,209			3,418			—
State net operating loss carryforwards & other		4,127			2,327			6,212			7,699
Rabbi trust and other		68			—			(1,053	)		2,276
Permanent differences and other		—			38			52			65
Total expense (benefit) for income taxes	$	57,651		$	(129,488	)	$	170,046		$	(171,464	)
Effective tax rate		45.3	%		36.5	%		41.5	%		35.0	%