Note 4 - Income Taxes

The income tax benefit recorded for the three and nine months ended September 30, 2017, and 2016, differs from the amounts that would be provided by applying the statutory United States federal income tax rate to income or loss before income taxes primarily due to the effect of excess tax benefits and deficiencies from share-based payment awards, state income taxes, changes in valuation allowances, and accumulated impacts of other smaller permanent differences. The quarterly rate can also be affected by the proportional impacts of forecasted net income or loss as of each period end presented.

The provision for income taxes for the three and nine months ended September 30, 2017, and 2016, consisted of the following:



	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2017			2016			2017			2016
	(in thousands)
Current portion of income tax benefit (expense):
Federal	$	2,832		$	—		$	—		$	—
State	(230		)	(24		)	(1,633		)	(265		)
Deferred portion of income tax benefit	36,668			23,756			67,458			314,770
Income tax benefit	$	39,270		$	23,732		$	65,825		$	314,505
Effective tax rate	30.6		%	36.7		%	32.8		%	36.1		%

On a year-to-date basis, a change in the Company’s effective tax rate between reporting periods will generally reflect differences in its estimated highest marginal state tax rate due to changes in the composition of income or loss from Company activities among multiple state tax jurisdictions. Cumulative effects of state tax rate changes are reflected in the period legislation is enacted. As a result of adopting ASU 2016-09 on January 1, 2017, excess tax benefits and deficiencies from share-based payment awards impact the Company’s effective tax rate between periods. As discussed in Note 7 - Compensation Plans, the Company settled various grants in the third quarter of 2017. As a result of these share-based award settlements, the Company recorded an $8.2 million excess tax deficiency in the third quarter of 2017 reducing the tax benefit and the tax benefit rate.

At the end of the third quarter 2017, the Company reevaluated various factors affecting deferred tax assets related to net operating losses and tax credits, and determined utilization would be appropriate. The change in the current portion of income tax benefit (expense) between periods reflects the effect of this determination. The Company is generally no longer subject to United States federal or state income tax examinations by tax authorities for years before 2013. Its 2003 to 2005 tax years have been reopened for net operating loss carryback claims and are currently under examination by the Internal Revenue Service (the “IRS”). During the quarter ended September 30, 2017, the Company received a $5.5 million refund in advance of the IRS completing its examination of the Company’s claims.