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Income Taxes
 12 Months Ended
Dec. 31, 2019
Income Tax Disclosure [Abstract]  
Income Taxes INCOME TAXES
The provision for income tax expense consisted of the following for the years ended December 31:
(in thousands)
2019
 
2018
 
2017
Current expense (benefit)
$
114,221

 
$
(115,195
)
 
$
84,827

Deferred expense
30,703

 
153,518

 
71,257

Tax credits
(4,363
)
 
(5,179
)
 
(5,618
)
Items charged to shareholders' equity
(25,123
)
 
(866
)
 
—

 
$
115,438

 
$
32,278

 
$
150,466


There was a balance receivable of $4.3 million, $208.0 million, and $4.5 million for federal and state income taxes at December 31, 2019, 2018, and 2017, respectively. The provision for federal income taxes differs from the amount computed by applying the federal income tax statutory rate of 21 percent for the years ended December 31, 2019 and 2018 and 35 percent for the year ended December 31, 2017 on income before income tax expense as indicated in the following analysis for the years ended December 31:
(in thousands)
2019
 
2018
 
2017
Federal tax based on statutory rate
$
104,914

 
$
84,531

 
$
102,508

Increase (decrease) resulting from:
 
 
 
 
 
Effect of tax-exempt income
(6,314
)
 
(5,801
)
 
(9,435
)
Interest and other nondeductible expenses
10,429

 
6,464

 
9,605

State taxes, net of federal benefit
18,073

 
12,459

 
6,970

Tax credits
(4,363
)
 
(5,179
)
 
(5,618
)
Other (1)
(7,301
)
 
(60,196
)
 
46,436

 
$
115,438

 
$
32,278

 
$
150,466

Effective tax rate
23.1
%
 
8.0
%
 
51.4
%


(1) The composition of other items resulting in a net tax benefit of $7.3 million for the year ended December 31, 2019 included $3.5 million in an unrecognized state tax credit, $2.3 million related to the remeasurement of deferred tax assets as a result of state statutory rate changes and changes to the state nexus, and $0.9 million related to equity based compensation.
The composition of other items resulting in a net tax benefit of $60.2 million for the year ended December 31, 2018 included a $6.6 million expense related to the finalization of accounting for the Sabadell United acquisition and its net impact from the remeasurement of deferred tax assets as a result of the passage of the Tax Act. In connection with filing its 2017 income tax returns, the Company recorded a non-core, permanent net income tax benefit of $65.3 million as a result of deductions associated with unrealized losses on securities and loans and depreciation on real and personal property.
The composition of other items resulting in a net tax expense of $46.4 million for the year ended December 31, 2017 included $51.0 million related to the estimated net impact from the remeasurement of deferred tax assets and liabilities as a result of the passage of the Tax Act in December 2017. This was partially offset by $3.0 million related to equity based compensation, $1.0 million resulting from the reversal of a prior year deferred tax asset impairment, and a $600 thousand benefit due to a deferred REIT distribution.
Significant components of deferred tax assets and liabilities at December 31 were as follows:
(in thousands)
2019
 
2018
Deferred tax assets:
 
 
 
NOL and credit carryforward
$
18,061

 
$
42,837

Allowance for credit losses
38,384

 
38,571

Deferred compensation
6,807

 
5,482

Basis difference in acquired assets and liabilities
8,967

 
9,228

OREO
1,234

 
32

Other
46,259

 
19,395

Gross deferred tax assets
119,712

 
115,545

Deferred tax liabilities:
 
 
 
Unrealized gains on loans and securities
(64,535
)
 
(98,807
)
Premises and equipment
(7,941
)
 
(10,626
)
Acquisition intangibles
(11,789
)
 
(9,757
)
Deferred loan costs
(6,834
)
 
(5,814
)
Basis difference in acquired assets and liabilities
(12,488
)
 
(17,628
)
Lease receivable
(79,795
)
 
(37,844
)
Other
(38,449
)
 
(6,485
)
Gross deferred tax liabilities
(221,831
)
 
(186,961
)
Net deferred tax liabilities
$
(102,119
)
 
$
(71,416
)

At December 31, 2019, the Company had cumulative federal net operating loss carryforwards of $35.7 million. These net operating loss carryforwards arising from acquisitions during 2015 expire over a 20-year period and will be utilized subject to annual Internal Revenue Code Section 382 limitations. No benefit was recognized at acquisition for net operating losses that will expire unused due to the IRS limitations.
At December 31, 2019, the Company had state net operating loss carryforwards of $169.5 million, resulting in a net state deferred tax asset of $7.7 million. These state carryforwards, if not utilized, will gradually expire through 2039.
The Company does not believe it has any unrecognized tax benefits included in its consolidated financial statements. The Company has not had any settlements in the current period with taxing authorities, nor has it recognized tax benefits as a result of a lapse of the applicable statute of limitations.
During the years ended December 31, 2019, 2018 and 2017, an immaterial amount of interest and penalty expense associated with state filings was recorded.

The Company files federal income tax returns, as well as returns in various state jurisdictions. The Company is subject to income tax examination by the IRS for the tax years 2014 and forward and is currently under examination by the IRS for the years 2014 to 2017.