INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Schedule of components of income tax provision (benefit)

The components of the Company’s consolidated provision for income taxes from continuing operations for the years ended December 31, 2019, 2018 and 2017 are as follows:

	Year Ended December 31,
	2019		2018		2017
	(In millions)
Current income tax provision (benefit):
Federal	$	—	$	—	$	—
State	—		—		—
Total current income tax provision (benefit)	—		—		—
Deferred income tax provision (benefit):
Federal	40		160		(21		)
State	7		8		1
Total deferred income tax provision (benefit)	47		168		(20		)
Total provision for (benefit from) income taxes	$	47	$	168	$	(20	)

Reconciliation of statutory federal income tax

A reconciliation of the statutory federal income tax amount from continuing operations to the recorded expense is as follows:

	Year Ended December 31,
	2019			2018			2017
	(In millions)
Income tax expense at the federal statutory rate(1)	$	76		$	234		$	174
Impact of nontaxable noncontrolling interest	—			(5		)	(12		)
Income tax benefit relating to change in statutory tax rate	—			—			(68		)
State income tax expense, net of federal tax effect	6			8			3
Non-deductible compensation	4			5			13
Change in valuation allowance	—			—			(127		)
Deferred taxes related to change in Viper LP's tax status	(42		)	(73		)	—
Other, net	3			(1		)	(3		)
Provision for (benefit from) income taxes	$	47		$	168		$	(20	)

(1)

The federal statutory rates for the years ended December 31, 2019, 2018 and 2017 were 21%, 21% and 35%, respectively.

Schedule of deferred tax assets and liabilities

The components of the Company’s deferred tax assets and liabilities as of December 31, 2019 and 2018 are as follows:

	December 31,
	2019			2018
	(In millions)
Deferred tax assets:
Net operating loss and other carryforwards	$	453		$	155
Stock based compensation	7			7
Viper LP's investment in Viper LLC	134			94
Other	11			9
Deferred tax assets	605			265
Valuation allowance	(7		)	(14		)
Deferred tax assets, net of valuation allowance	598			251
Deferred tax liabilities:
Oil and natural gas properties and equipment	2,275			1,825
Midstream investments	50			67
Derivative instruments	6			47
Rattler LP's investment in Rattler LLC	8			—
Other	3			—
Total deferred tax liabilities	2,342			1,939
Net deferred tax liabilities	$	1,744		$	1,688

Schedule of unrecognized tax benefits

The following table sets forth changes in the Company’s unrecognized tax benefits:

	December 31,
	2019			2018
	(in millions)
Balance at beginning of year	$	7		$	—
Increase resulting from tax positions acquired	—			7
Increase resulting from prior period tax positions	—			—
Increase resulting from current period tax positions	—			—
Balance at end of year	7			7
Less: Effects of temporary items	(5		)	(5		)
Total that, if recognized, would impact the effective income tax rate as of the end of the year	$	2		$	2