Taxes

The Company is subject to U.S. federal income tax as well as income tax in multiple state jurisdictions. The tax years 2002 through 2015 remain open to examination for U.S. federal income tax matters and 1998 through 2015 remain open to examination for various state income tax matters.

Significant components of the provision for (benefit from) income taxes are as follows:



	Year Ended December 31
	2015			2014		2013
	(In thousands)
Current:
Federal	$	—		$	—	$	—
State	3			25		(647		)
Total current	3			25		(647		)
Deferred:
Federal	(329,393		)	18,535		(318,956		)
State	(43,990		)	7,074		(15,895		)
Total deferred	(373,383		)	25,609		(334,851		)
	$	(373,380	)	$	25,634	$	(335,498	)

A reconciliation of the statutory federal income tax provision (benefit) at the statutory rate to the actual provision for (benefit from) income taxes follows:



	Year Ended December 31
	2015			2014			2013
	(In thousands)
Income tax provision (benefit) at statutory rate	$	(1,150,283	)	$	(186,452	)	$	(378,463	)
Percentage depletion allowance	(19,035		)	(12,692		)	(15,796		)
Goodwill	—			—			70,301
State taxes, net of effect of federal taxes	(76,445		)	(3,903		)	(25,265		)
Change in valuation allowance	865,146			226,929			8,659
Other, net	7,237			1,752			5,066
	$	(373,380	)	$	25,634		$	(335,498	)

In 2015, 2014 and 2013, compensatory stock options and other equity based compensation awards were exercised resulting in a tax expense of $6.7 million, $1.6 million and $1.5 million, respectively. The tax benefit will be recorded in paid-in capital at such point in time when a cash tax benefit is recognized.

Significant components of the Company's deferred tax assets and liabilities that result from carryforwards and temporary differences between the financial statement basis and tax basis of assets and liabilities are summarized as follows:



	December 31,
	2015			2014
	(In thousands)
Deferred tax assets:
Net operating loss carryforwards	$	1,086,332		$	871,848
Alternative minimum tax credit carryforwards	120,994			127,169
Reclamation and mine closure	121,276			114,430
Goodwill	38,671			50,072
Workers' compensation	42,835			38,924
Share based compensation	22,612			30,283
Acquired sales contracts	17,466			26,833
Retiree benefit plans	16,996			22,913
Contract obligations	—			15,693
Advance royalties	18,751			—
Losses from disposed operations resulting from Patriot Coal bankruptcy	39,287			—
Other, primarily accrued liabilities	45,303			64,503
Gross deferred tax assets	1,570,523			1,362,668
Valuation allowance	(1,135,399		)	(270,251		)
Total deferred tax assets	435,124			1,092,417
Deferred tax liabilities:
Plant and equipment	389,169			1,354,396
Deferred development	41,047			95,129
Investment in tax partnerships	—			7,377
Other	4,706			5,533
Total deferred tax liabilities	434,922			1,462,435
Net deferred (asset) liability	(202		)	370,018

The Company has federal net operating loss carryforwards for regular income tax purposes of $3.0 billion at December 31, 2015 that will expire between 2022 and 2035. The Company has an alternative minimum tax credit carryforward of $121.0 million at December 31, 2015, which has no expiration date and can be used to offset future regular tax in excess of the alternative minimum tax.

The Company recorded increases in its valuation allowance against its deferred tax assets of $865.1 million, $226.9 million and $8.7 million in 2015, 2014 and 2013, respectively. In 2015 and 2014, the Company determined that it would not realize the all of the benefit from federal and state net operating losses, based on projections of reversing timing differences in the future. Adjustments in 2013 relate to certain state and foreign net operating loss benefits.

A reconciliation of the beginning and ending amounts of gross unrecognized tax benefits follows:



		(In thousands)
Balance at	January 1, 2013	$	31,150
Additions based on tax positions related to the current year		1,199
Additions for tax positions of prior years		688
Reductions as a result of lapses in the statute of limitations		(1,248		)
Balance at	December 31, 2013	31,789
Additions based on tax positions related to the current year		2,920
Balance at	December 31, 2014	34,709
Additions for tax positions of the current year		4,168
Balance at	December 31, 2015	$	38,877

If recognized, the entire amount of the gross unrecognized tax benefits at December 31, 2015 would affect the effective tax rate.

The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense. The Company had accrued interest and penalties of $1.7 million and $1.5 million at December 31, 2015 and 2014, respectively. In the next 12 months, no gross unrecognized tax benefits are expected to be reduced due to the expiration of the statute of limitations.