| Income Taxes |
The income tax provision charged to operations for the years ended December 31, 2018, 2017 and 2016 was as follows (in thousands):
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Years Ended December 31, |
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2018 |
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2017 |
|
2016 |
Current: |
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U.S. Federal |
$ |
35,593 |
|
|
$ |
46,013 |
|
|
$ |
21,665 |
|
State and local |
1,607 |
|
|
851 |
|
|
376 |
|
|
37,200 |
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|
46,864 |
|
|
22,041 |
|
Deferred expense (benefit) |
14,814 |
|
|
966 |
|
|
(1,420 |
) |
|
$ |
52,014 |
|
|
$ |
47,830 |
|
|
$ |
20,621 |
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The Trust is taxed as if it were a corporation. Total income tax expense differed from the amounts computed by applying the U.S. Federal income tax rate of 21% for the year ended December 31, 2018 and 35% for the years ended December 31, 2017 and 2016 to income before Federal income taxes as a result of the following (in thousands):
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Years Ended December 31, |
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2018 |
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2017 |
|
2016 |
Computed tax expense at the statutory rate |
$ |
54,968 |
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|
$ |
50,771 |
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|
$ |
22,014 |
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Reduction in income taxes resulting from: |
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Statutory depletion |
(4,185 |
) |
|
(3,378 |
) |
|
(1,609 |
) |
State taxes |
1,243 |
|
|
530 |
|
|
231 |
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Effect of change in statutory tax rate (1)
|
— |
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|
(103 |
) |
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— |
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Other, net |
(12 |
) |
|
10 |
|
|
(15 |
) |
|
$ |
52,014 |
|
|
$ |
47,830 |
|
|
$ |
20,621 |
|
|
|
(1) |
The effect of the change in statutory income tax rate from 35% to 21% effective January 1, 2018 which was anticipated as of December 31, 2017.
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The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities at December 31, 2018 and 2017 are as follows (in thousands):
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December 31, 2018 |
|
December 31, 2017 |
Deferred revenue |
$ |
2,878 |
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|
$ |
1,796 |
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Total deferred tax assets |
2,878 |
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|
1,796 |
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Basis differences in property, plant and equipment |
10,723 |
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|
1,691 |
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Deferred gains on 1031 exchanges |
6,791 |
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|
— |
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Basis differences in real estate acquired through foreclosure |
142 |
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|
142 |
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Basis difference in pension plan liability |
119 |
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|
68 |
|
Deferred installment revenue on land sales for tax purposes |
6 |
|
|
9 |
|
Total deferred tax liability |
17,781 |
|
|
1,910 |
|
Net deferred tax liability |
$ |
(14,903 |
) |
|
$ |
(114 |
) |
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The Trust files a U. S. Federal income tax return. With few exceptions, the Trust is no longer subject to U. S. Federal income tax examination by tax authorities for years before 2015.
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