Note 4 - Income Taxes

The income tax expense recorded for the three months ended March 31, 2018, and 2017, 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 state income taxes, excess tax benefits and deficiencies from share-based payment awards, 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 months ended March 31, 2018, and 2017, consisted of the following:



	For the Three Months Ended March 31,
	2018			2017
	(in thousands)
Current portion of income tax expense:
Federal	$	—		$	(7,439	)
State	(625		)	(3,842		)
Deferred portion of income tax expense	(98,366		)	(33,225		)
Income tax expense	$	(98,991	)	$	(44,506	)
Effective tax rate	23.8		%	37.4		%

The enactment of the 2017 Tax Act on December 22, 2017, reduced the Company’s federal tax rate for 2018 and future years from 35 percent to 21 percent. Although the Company believes it has properly analyzed the tax accounting impacts of the 2017 Tax Act, it will continue to monitor provisions with discrete rate impacts, such as the limitation on executive compensation for subsequent events and guidance within the one year measurement period. There are no new estimates or finalized income tax items associated with the 2017 Tax Act included in income tax expense for the three months ended March 31, 2018.

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. However, state rate differences between reported periods were not significant. Excess tax benefits and deficiencies from share-based payment awards impact the Company’s effective tax rate between periods.

In 2017, the Company re-evaluated 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 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.