INCOME TAXES

On December 31, 2014, CREC merged into Cousins and Cousins formed CTRS. Amounts included in the following table for 2015 reflect the benefit (provision) of CTRS and the amounts for 2014 and 2013 reflect the benefit (provision) for CREC.



	2015		2014		2013
Current tax benefit:
Federal	$	—	$	—	$	—
State			20		23
	—		20		23
Deferred tax benefit:
Federal	—		—		—
State	—		—		—
	—		—		—
Benefit for income taxes from operations	$	—	$	20	$	23

The net income tax benefit differs from the amount computed by applying the statutory federal income tax rate to CTRS' income before taxes for the year ended December 31, 2015, and to CREC’s income before taxes for the years ended 2014 and 2013 as follows ($ in thousands):



	2015					2014					2013
	Amount			Rate		Amount			Rate		Amount			Rate
Federal income tax benefit (expense)	$	778		35	%	$	(1,124	)	(35	)%	$	(1,287	)	(35	)%
State income tax benefit (expense), net of federal income tax effect	90			4	%	(125		)	(4	)%	(147		)	(4	)%
Valuation allowance	(833		)	(37	)%	1,644			50	%	(361		)	(10	)%
State deferred tax adjustment	(35		)	(2	)%	(375		)	(11	)%	1,818			49	%
Benefit applicable to income (loss) from continuing operations	$	—		—	%	$	20		—	%	$	23		—	%

On December 31, 2014, CREC merged into Cousins and Cousins contributed some of the assets and contracts that were previously owned by CREC to CTRS, a newly formed taxable REIT subsidiary of Cousins. Cousins retained many of CREC's tax benefits, including the significant portion of CREC's Federal and state tax carryforwards. Some of CREC's tax benefits were assumed by CTRS upon the contributions Cousins made to CTRS immediately following CREC's merger into Cousins. The tax effect of significant temporary differences representing deferred tax assets and liabilities of CTRS as of December 31, 2015 and 2014 are as follows (in thousands):



	2015			2014
Income from unconsolidated joint ventures	$	928		$	2,441
Federal and state tax carryforwards	680			—
Total deferred tax assets	1,608			2,441
Valuation allowance	(1,608		)	(2,441		)
Net deferred tax asset	$	—		$	—

A valuation allowance is required to be recorded against deferred tax assets if, based on the available evidence, it is more likely than not that such assets will not be realized. When assessing the need for a valuation allowance, appropriate consideration should be given to all positive and negative evidence related to this realization. This evidence includes, among other things, the existence of current and recent cumulative losses, forecasts of future profitability, the length of statutory carryforward periods, the Company’s history with loss carryforwards and available tax planning strategies.

As of December 31, 2015 and 2014 the deferred tax asset of CTRS equaled $1.6 million and $2.4 million, respectively, with a valuation allowance placed against the full amount of each. The conclusion that a valuation allowance should be recorded as of December 31, 2015 and 2014 was based the lack of evidence that CTRS, could generate future taxable income to realize the benefit of the deferred tax assets.