INCOME TAXES

The following table sets forth our provision for income taxes from continuing operations and excludes discontinued operations for the periods indicated:



	Years Ended December 31,
	2018		2017		2016
	(Thousands of dollars)
Current income tax provision
Federal	$	260	$	295	$	6,086
State	1,633		1,670		2,449
Total current income taxes	1,893		1,965		8,535
Deferred income tax provision
Federal	319,551		376,728		193,974
State	41,459		68,589		9,897
Total deferred income taxes	361,010		445,317		203,871
Total provision for income taxes	$	362,903	$	447,282	$	212,406

The following table is a reconciliation of our income tax provision from continuing operations and excludes discontinued operations for the periods indicated:



	Years Ended December 31,
	2018			2017			2016
	(Thousands of dollars)
Income before income taxes	$	1,517,935		$	1,040,801		$	957,956
Less: Net income attributable to noncontrolling interests	3,329			205,678			391,460
Net income attributable to ONEOK before income taxes	1,514,606			835,123			566,496
Federal statutory income tax rate	21.0		%	35.0		%	35.0		%
Provision for federal income taxes	318,067			292,293			198,274
State income taxes, net of federal benefit	38,668			16,197			12,303
Deferred tax rate change, inclusive of valuation allowance	5,552			141,283			43
Other, net	616			(2,491		)	1,786
Income tax provision	$	362,903		$	447,282		$	212,406

The following table sets forth the tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and liabilities for the periods indicated:



	December 31, 2018			December 31, 2017
Deferred tax assets	(Thousands of dollars)
Employee benefits and other accrued liabilities	$	91,587		$	85,355
Federal net operating loss	420,318			159,162
State net operating loss and benefits	108,004			73,277
Derivative instruments	22,108			30,060
Other	13,378			13,546
Total deferred tax assets	655,395			361,400
Valuation allowance for state net operating loss and tax credits
Carryforward expected to expire prior to utilization	(73,820		)	(66,632		)
Net deferred tax assets	581,575			294,768
Deferred tax liabilities
Excess of tax over book depreciation	73,113			64,508
Investment in partnerships (a)	728,193			77,035
Regulatory assets	—			15
Total deferred tax liabilities	801,306			141,558
Net deferred tax assets (liabilities)	$	(219,731	)	$	153,210

(a) Due primarily to excess of tax over book depreciation.

In December 2017, the Tax Cuts and Jobs Act was signed into law. The Tax Cuts and Jobs Act made extensive changes to the U.S. tax laws and included provisions that, beginning in 2018, reduced the U.S. corporate tax rate to 21 percent from 35 percent, increased expensing for capital investment, limited the interest deduction, and limited the use of net operating losses to offset future taxable income. We revalued our deferred tax assets and liabilities as required at enactment. At that time, our net deferred tax assets represented expected corporate tax benefits in the future. The reduction in the federal corporate tax rate reduced these benefits, which resulted in a one-time noncash charge to net income through income tax expense of $141.3 million, inclusive of the valuation allowance described below, recorded in the fourth quarter 2017.

Tax benefits related to certain state net operating loss, tax credit carryforwards and charitable contribution carryforwards will begin expiring in 2020. Due to the Tax Cuts and Jobs Act and the impact of increased expensing for capital investment, we believe that it is more likely than not that the tax benefits of certain carryforwards will not be utilized prior to their expirations; therefore, we recorded a valuation allowance of $5.6 million and $54.1 million related to these tax benefits in 2018 and 2017, respectively.

As a result of adopting ASU 2016-09, “Improvements to Employee Share-Based Payment Accounting,” in first quarter 2017, we recorded an adjustment increasing beginning retained earnings and deferred tax assets of $73.4 million to recognize the cumulative tax benefits included in net operating loss carryforwards on the tax return but not reflected in deferred tax assets as of December 31, 2016. Beginning in January 2017, all share-based payment tax effects have been recorded in earnings.