Provision (Benefit) for Income Taxes

Income (Loss) before taxes is as follows (in thousands):



	Year Ended December 31, 2018		Year Ended December 31, 2017
Income (Loss) Before Income Taxes	$	75,543	$	70,017

The following is an analysis of the consolidated income tax provision (benefit) (in thousands):



	Year Ended December 31, 2018			Year Ended December 31, 2017
Current	$	(86	)	$	(1,954	)
Deferred	1,014			—
Total	$	928		$	(1,954	)

Reconciliations of income taxes computed using the U.S. Federal statutory rates of (21%) and (35%) to the effective income tax rates are as follows (in thousands):



	Year Ended December 31, 2018		Year Ended December 31, 2017
Federal Statutory Rate	21.0	%	35.0	%
State tax provisions (benefits), net of federal benefits	1.2	%	1.6	%
Expiration/Write-off of NOL Carryovers	—	%	13.9	%
Change in Enacted Tax Rates	—	%	55.6	%
Executive Compensation Limitation	0.3	%	0.6	%
Other, net	0.2	%	2.3	%
Valuation allowance adjustments	(21.4	)%	(111.8	)%
Effective rate	1.2	%	(2.8	)%

The tax effects of temporary differences representing the net deferred tax asset (liability) at December 31, 2018 and 2017 were as follows (in thousands):



	Year Ended December 31, 2018			Year Ended December 31, 2017
Deferred tax assets:
Federal net operating loss (“NOL”) carryovers	$	71,736		$	58,438
Alternative minimum tax credits	—			138
Other Carryover Items	583			619
Asset Retirement Obligations	920			2,329
Derivative Contracts	—			29
Share-based compensation	906			872
Other	956			2,190
Valuation allowance	(42,335		)	(58,398		)
Total deferred tax assets	$	32,766		$	6,217

Deferred tax liabilities:
Oil and gas exploration and development costs	$	(30,935	)	$	(6,054	)
Derivative Contracts	(2,817		)	—
Other	(28		)	(163		)
Total deferred tax liabilities	(33,780		)	(6,217		)

Net deferred tax liabilities	$	(1,014	)	$	—

The Company was in a net deferred tax asset position at December 31, 2018 and 2017 for United States federal income tax purposes. Management has determined that it is not more likely than not that the Company will realize future cash benefits from this additional tax basis and remaining carryover items and accordingly has recorded a full valuation allowance to offset its tax assets. The Company’s valuation allowance balance was $42 million and $58 million at December 31, 2018 and 2017, respectively. The Company recorded a net deferred tax liability for state income tax purposes at December 31, 2018.

The Company’s NOL carryforward asset is attributable to Federal tax losses of $115 million generated from 2013 through 2015, $160 million generated in 2017, and a $67 million tax loss for 2018. The losses generated between 2013 and 2015 are subject to an annual utilization limit under Sec. 382. These losses will expire between 2033 and 2035 if not utilized in earlier periods. The 2017 loss will expire in 2037 if not utilized. The 2018 loss will not expire under the current tax code, but its usage will be limited to 80% of taxable income.

On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the "Act"). The Act makes broad and complex changes to the U.S. tax code that includes, among other provisions, a permanent reduction of the U.S. federal corporate tax rate from 35% to 21% and a repeal of the alternative minimum tax regime, both effective January 1, 2018. The Company completed its review of previously recorded provisional income tax amounts related to its deferred tax assets impacted by the Act, and concluded that additional information, interpretation and guidance that became available during the twelve-month measurement period did not alter the Company’s application of tax law in remeasuring gross deferred tax assets and related valuation allowances. There were no material adjustments deemed necessary in the period ended December 31, 2018 and the Company’s accounting for the Act is now final.

As of December 31, 2018, the Company does not have any accrued liability for uncertain tax positions. We do not believe the total of unrecognized tax positions will significantly increase or decrease during the next 12 months.

The Company records interest and penalties related to potential underpayment of any unrecognized tax benefits as a component of income tax expense. The Company has not incurred any interest or penalties associated with unrecognized tax benefits.

Our U.S. federal and state income tax returns from 2015 forward are subject to examination. For years prior to 2015 our U.S federal returns are subject to examination to the extent of our net operating loss (NOL) carryforwards. There are no material unresolved items related to periods previously audited by the taxing authorities.