NOTE 12—INCOME TAXES

Income tax expense consisted of the following:


	Year Ended December 31,
(In thousands)	2019		2018		2017
Current taxes:
Federal	$	—	$	—	$	—
State		7		4		—
Current taxes		7		4		—
Deferred taxes:
Federal		3,228		(111)		—
State		1,928		220		—
Deferred taxes		5,156		109		—
Provision for income taxes, net	$	5,163	$	113	$	—

The items accounting for differences between income taxes computed at the federal statutory rate and the provision recorded for income taxes were as follows:


	Year Ended December 31,
(In thousands)	2019		2018		2017
Income taxes computed at the federal statutory rate	$	6,320	$	5,289	$	(5,242)
Effect of:
(Income) loss taxed as partnership		—		—		(552)
State taxes, net of federal benefits		945		970		(610)
Percentage depletion		(2,093)		(1,033)		—
Changes in tax status		—		—		(205)
Change in valuation allowance		—		(4,464)		4,464
Change in enacted tax rates		—		—		2,119
Other, net		(9)		(649)		26
Total	$	5,163	$	113	$	—

Deferred tax assets and liabilities were as follows:


	December 31,
(In thousands)	2019		2018
Deferred tax assets:
Loss carryforwards U.S. - Federal/States	$	19,512	$	17,073
Asset retirement obligations		3,523		3,306
Accrued expenses		725		521
Stock-based compensation		2,094		1,393
Other		—		4
Total deferred tax assets		25,854		22,297
Less valuation allowance		—		—
Deferred tax assets, net		25,854		22,297

Deferred tax liabilities:
Depreciation & amortization		(31,119)		(22,406)
Net deferred tax liabilities	$	(5,265)	$	(109)

As of December 31, 2019, our federal net operating loss carryforwards for income tax purposes were approximately $81 million. Total state loss carryforwards were approximately $57 million. If not utilized, federal and state net operating loss carryforwards approximating $60 million and $47 million, respectively, will expire between 2035 and 2037. The remaining net operating loss carryforwards have no statutory expiration.

A valuation allowance was previously established against our net deferred tax assets given our limited operating history. This valuation allowance was reversed in 2018.

Tax Cuts and Jobs Act—On December 22, 2017, the U.S. Government enacted comprehensive tax legislation referred to as the Tax Cuts and Jobs Act (the “Act”). The Act made broad and complex changes to the U.S. tax code, including but not limited to, reducing the U.S. federal corporate rate from 35% to 21%, allowing full expensing of qualified property acquired and placed in service after September 27, 2017 and imposing new limits on the deduction of net operating losses, executive compensation and net interest expense. There was no impact of the Act on our 2017 financial statements.