Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Schedule of Components of Income Tax Expense (Benefit)

The following schedule discloses significant components of income tax expense (benefit) for each year presented:



	Year Ended December 31,
	2019			2018			2017
	(in thousands)
Current tax expense (benefit):
U.S. Federal	$	56,371		$	36,739		$	(52,502	)
Total	56,371			36,739			(52,502		)
Deferred tax expense (benefit):
U.S. Federal	(115,503		)	(89,380		)	(104,326		)
Total	(115,503		)	(89,380		)	(104,326		)
Total income tax expense (benefit) on income (loss) before equity in earnings of operating joint ventures	(59,132		)	(52,641		)	(156,828		)
Income tax expense (benefit) on equity in earnings of operating joint ventures(1)	(1,773		)	648			0
Income tax expense (benefit) reported in equity related to:
Other comprehensive income (loss)	81,281			(55,174		)	43,372
Additional paid-in capital	0			0			824
Total income tax expense (benefit)	$	20,376		$	(107,167	)	$	(112,632	)

Schedule of Effective Income Tax Rate Reconciliation

The differences between income taxes expected at the U.S. federal statutory income tax rate of 21% applicable for 2019 and 2018 and 35% applicable for 2017, and the reported income tax expense (benefit) are provided in the following table:



	Year Ended December 31,
	2019			2018			2017
	(in thousands)
Expected federal income tax expense	$	33,345		$	12,136		$	60,007
Non-taxable investment income	(52,291		)	(49,845		)	(157,408		)
Tax credits	(40,602		)	(40,272		)	(29,506		)
Domestic production activities deduction, net	0			0			(10,447		)
Changes in tax law	0			3,618			(20,165		)
Settlements with taxing authorities	0			20,984			0
Other	416			738			691
Reported income tax expense (benefit)	$	(59,132	)	$	(52,641	)	$	(156,828	)
Effective tax rate	(37.2		)%	(91.1		)%	(91.5		)%

Schedule of Deferred Tax Assets and Liabilities



	As of December 31,
	2019		2018
	(in thousands)
Deferred tax assets:
Insurance reserves	$	427,843	$	245,488
Net unrealized loss on securities	0		8,283
Employee benefits	7,141		0
Other	1,969		1,897
Deferred tax assets	436,953		255,668
Deferred tax liabilities:
Deferred policy acquisition cost	67,431		55,030
Net unrealized gain on securities	83,801		0
Investments	142,028		95,294
Deferred tax liabilities	293,260		150,324
Net deferred tax asset (liability)	$	143,693	$	105,344

Unrecognized Tax Benefits Reconciliation

The following table reconciles the total amount of unrecognized tax benefits at the beginning and end of the periods indicated.



	2019		2018			2017
	(in thousands)
Balance at January 1,	$	0	$	30,196		$	9,488
Increases in unrecognized tax benefits-prior years	0		0			12,373
(Decreases) in unrecognized tax benefits-prior years	0		0			0
Increases in unrecognized tax benefits-current year	0		0			8,335
(Decreases) in unrecognized tax benefits-current year	0		0			0
Settlements with taxing authorities	0		(30,196		)	0
Balance at December 31,	$	0	$	0		$	30,196
Unrecognized tax benefits that, if recognized, would favorably impact the effective rate	$	0	$	0		$	30,196