Income tax expense included in net income consisted of the following components:

	Years Ended December 31,
(in thousands)	2019		2018		2017
Included in net income
Current federal	$	12,172	$	7,594	$	38,859
Current state		6,087		5,538		4,112
Total current provision		18,259		13,132		42,971
Deferred federal		46,290		41,078		48,653
Deferred state		810		4,136		1,178
Total deferred provision		47,100		45,214		49,831
Total included in net income	$	65,359	$	58,346	$	92,802

Income tax expense does not reflect the tax effects of amounts recognized in other comprehensive income and in AOCI, a separate component of stockholders’ equity. These amounts include unrealized gains and losses on securities available for sale or transferred to held to maturity, unrealized gains and losses on derivatives and hedging transactions, and valuation adjustments of defined benefit and other post-retirement benefit plans. Refer to Note 12 – Stockholders’ Equity for additional information.

Temporary differences arise between the tax bases of assets or liabilities and their carrying amounts for financial reporting purposes. The expected tax effects from when these differences are resolved are recorded currently as deferred tax assets or liabilities.

Significant components of the Company’s deferred tax assets and liabilities were as follows:

	December 31,
(in thousands)	2019			2018
Deferred tax assets:
Allowance for loan losses	$	47,008		$	45,198
Employee compensation and benefits		—			12,796
Loan purchase accounting adjustments		18,717			1,132
Tax credit carryforward		2,025			2,059
Securities		—			17,390
Federal/State net operating loss		7,295			1,629
Lease liability		29,003			—
Other		7,893			18,431
Gross deferred tax assets		111,941			98,635
State valuation allowance		(1,415	)		(1,629	)
Net deferred tax assets	$	110,526		$	97,006
Deferred tax liabilities:
Employee compensation and benefits	$	(9,662	)	$	—
Securities		(9,589	)		—
Fixed assets & intangibles		(48,144	)		(44,277	)
Lease Financing		(41,565	)		(23,605	)
Right-of-use asset		(24,887	)		—
Other		(14,400	)		(6,157	)
Gross deferred tax liabilities	$	(148,247	)	$	(74,039	)
Net deferred tax asset (liability)	$	(37,721	)	$	22,967

Reported income tax expense differed from amounts computed by applying the statutory income tax rate of 21% for the years ended December 31, 2019 and 2018 and 35% for the year ended December 31, 2017 to earnings before income taxes. The primary differences are due to tax-exempt income, federal and state tax credits, and excess tax benefits from stock-based compensation in 2019. The main source of tax credits has been investments in tax-advantaged securities and tax credit projects. These investments are made primarily in the markets we serve and directed at tax credits issued under the Qualified Zone Academy Bonds (“QZAB”), Qualified School Construction Bonds (“QSCB”), as well as Federal and State New Market Tax Credit (“NMTC”) and Low-Income Housing Tax Credit (“LIHTC”) programs. A summary of the factors that impacted income tax expense follows.

	Years Ended December 31,
	2019							2018							2017
($ in thousands)	Amount			%				Amount			%				Amount			%
Taxes computed at statutory rate	$	82,475			21.0		%	$	80,244			21.0		%	$	107,952			35.0		%
Increases (decreases) in taxes resulting from:
State income taxes, net of federal income tax benefit		7,204			1.8				8,770			2.3				4,288			1.4
Tax-exempt interest		(10,435	)		(2.7	)			(10,803	)		(2.8	)			(18,870	)		(6.1	)
Life insurance contracts		(3,901	)		(1.0	)			(2,019	)		(0.5	)			(5,360	)		(1.7	)
Tax credits		(10,293	)		(2.6	)			(11,344	)		(3.0	)			(9,286	)		(3.1	)
Employee share-based compensation		(842	)		(0.2	)			(1,380	)		(0.3	)			(5,824	)		(1.9	)
FDIC assessment disallowance		1,895			0.5				2,818			0.7				—			—
Return to provision adjustment		(1,459	)		(0.4	)			(9,942	)		(2.6	)			(120	)		—
Impact of deferred tax asset re-measurement		—			—				—			—				19,520			6.3
Other, net		715			0.2				2,002			0.5				502			0.2
Income tax expense	$	65,359			16.6		%	$	58,346			15.3		%	$	92,802			30.1		%

As of December 31, 2019, the Company had approximately $2.0 million in state tax credit carryforwards that originated in the tax years from 2015 through 2019 and begin expiring in 2022. These carryforwards are primarily from investments in state NMTC projects.

In 2019, the Company invested in certain affordable housing project limited partnerships that are qualified low-income housing tax credit developments. These investments are considered variable interest entities for which the Company is not the primary beneficiary and, therefore, are not consolidated. The tax credits, when realized, will be reflected in the consolidated statement of income as a reduction of income tax expense. The unamortized portion of the investment is reflected within other assets in the consolidated balance sheets. The Company’s investments in affordable housing limited partnerships totaled $37.3 million at December 31, 2019. There were no such investments at December 31, 2018.

The Company had approximately $22.9 million in state net operating loss carryforwards that originated in the tax years 2004 through 2019 and begin expiring in 2024. A valuation allowance has been established for the state net operating loss carryforwards. The impact of this valuation allowance is immaterial to the financial statements.

The tax benefit of a position taken or expected to be taken in a tax return should be recognized when it is more likely than not that the position will be sustained on its technical merits. The liability for unrecognized tax benefits was immaterial as of December 31, 2019, 2018 and 2017. The Company does not expect the liability for unrecognized tax benefits to change significantly during 2020. The Company recognizes interest and penalties, if any, related to income tax matters in income tax expense, and the amounts recognized during 2019, 2018 and 2017 were insignificant.

The Company and its subsidiaries file a consolidated U.S. federal income tax return, as well as filing various state returns. Generally, the returns for years prior to 2016 are no longer subject to examination by taxing authorities.