Income Taxes and Accounting for Uncertainty in Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Income Taxes and Accounting for Uncertainty in Income Taxes

Schedule of components of the (provision for) benefit from income taxes

	For the Years Ended December 31,
	2019		2018		2017
	(In thousands)
Current (benefit) provision:
Federal	$	173,326	$	44,451	$	(71,141)
State		43,579		29,918		38,058
Foreign		6,203		4,616		3,736
Total current (benefit) provision		223,108		78,985		(29,347)
Deferred (benefit) provision:
Federal		204,403		383,096		(547,575)
State		21,732		64,000		69,076
Increase (decrease) in valuation allowance		2,115		7,603		(7,474)
Total deferred (benefit) provision		228,250		454,699		(485,973)
Total (benefit) provision	$	451,358	$	533,684	$	(515,320)

Schedule of reconciliation of amounts computed by applying the statutory Federal tax rate to income before taxes

	For the Years Ended December 31,
	2019	2018	2017
	% of pre-tax income/(loss)
Statutory rate	21.0	21.0	35.0
State income taxes, net of federal benefit	3.2	4.6	3.0
Tax Reform Act (1)	—	—	(72.6)
Nondeductible/Nontaxable items (2)	—	—	5.9
Other, net	(1.0)	(1.2)	(2.5)
Total (benefit) provision for income taxes	23.2	24.4	(31.2)

(1) On December 22, 2017, the Tax Reform Act was enacted, which, among other things, lowered the federal statutory corporate tax rate effective for us in future periods from 35% to 21%. Consequently, we remeasured our deferred tax assets and liabilities as of December 31, 2017 which positively impacted our “Income tax (provision) benefit, net” by approximately $1.2 billion.

(2) During the year ended December 31, 2017, we recorded $255 million of “Litigation expense” related to the FTC Action on our Consolidated Statements of Operations and Comprehensive Income (Loss). Any eventual payments made with respect to the FTC Action may not be deductible for tax purposes, which had a negative impact on our effective tax rate for the year ended December 31, 2017. The tax deductibility of any eventual payments made with respect to the FTC Action may change, based upon, among other things, further developments in the FTC Action, including final adjudication of the FTC Action. See Note 15 for further information.

Schedule of deferred tax assets and liabilities

	As of December 31,
	2019		2018
	(In thousands)
Deferred tax assets:
NOL, interest, credit and other carryforwards	$	368,545	$	114,227
Accrued and prepaid expenses		8,488		—
Stock-based compensation		19,821		21,323
Unrealized (gains) losses on available for sale and other investments		4,137		4,918
Deferred revenue		17,238		18,361
Total deferred tax assets		418,229		158,829
Valuation allowance		(28,359)		(26,244)
Deferred tax asset after valuation allowance		389,870		132,585
Deferred tax liabilities:
Depreciation		(583,374)		(443,128)
Accrued and prepaid expenses		—		(8,662)
FCC authorizations and other intangible amortization		(2,040,885)		(1,635,385)
Bases difference in partnerships and cost method investments (1)		(573,548)		(447,585)
Discount on convertible notes and convertible note hedge transaction, net		(62,718)		(72,732)
Total deferred tax liabilities		(3,260,525)		(2,607,492)
Net deferred tax asset (liability)	$	(2,870,655)	$	(2,474,907)

(1) Included in this line item are deferred taxes related to, among other things, our non-controlling investments in Northstar Spectrum and SNR HoldCo, including deferred taxes created by the tax amortization of the Northstar Licenses and SNR Licenses.

Schedule of reconciliation of the beginning and ending amount of unrecognized tax benefits

	For the Years Ended December 31,
Unrecognized tax benefit	2019		2018		2017
	(In thousands)
Balance as of beginning of period	$	385,394	$	393,916	$	358,023
Additions based on tax positions related to the current year		244,257		10,350		12,798
Additions based on tax positions related to prior years		61,909		1,670		30,596
Reductions based on tax positions related to prior years		(13,028)		(6,291)		(2,754)
Reductions based on tax positions related to settlements with taxing authorities		(2,362)		(8,328)		(1,634)
Reductions based on tax positions related to the lapse of the statute of limitations		(1,963)		(5,923)		(3,113)
Balance as of end of period	$	674,207	$	385,394	$	393,916