Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Income Taxes

Schedule of components of provision (benefit) for income taxes

The provision (benefit) for income taxes includes the following components (in thousands):

	Year ended December 31,
	2018		2017		2016
Current tax provision (benefit):
Federal	$	(21,598)	$	5,853	$	(3,801)
State		1,465		180		111
Foreign		1,575		—		—
		(18,558)		6,033		(3,690)
Deferred tax provision (benefit):
Federal		92,250		(166,890)		(77,430)
State		12,250		20,133		(6,106)
		104,500		(146,757)		(83,536)
Provision (benefit) for income taxes	$	85,942	$	(140,724)	$	(87,226)

Schedule of income tax rate reconciliation

The following is a reconciliation between a federal income tax rate of 21% for 2018 and 35% for 2017 and 2016 of income (loss) before income taxes and the effective tax rate which is derived by dividing the provision (benefit) for income taxes by the income (loss) before the provision for income (loss) taxes (in thousands):

	Year ended December 31,
	2018		2017		2016
Computed provision (benefit) for income taxes at the statutory rate	$	76,926	$	100,864	$	(87,084)
Increase (decrease) in income taxes resulting from:
State income tax provision (benefit), net of federal income tax benefit		12,711		7,778		(5,768)
Non-deductible expenses		1,956		3,230		3,552
Valuation allowance changes affecting the provision for income taxes		(1,187)		505		751
Foreign income taxes, net of federal & state benefit		1,192		—		—
Excess tax benefits from share-based compensation		(4,548)		(5,377)		—
Revaluation of net deferred taxes for the Tax Act		—		(246,845)		—
Other, net		(1,108)		(879)		1,323
Provision (benefit) for income taxes	$	85,942	$	(140,724)	$	(87,226)

Schedule of components of the net deferred tax assets and liabilities

The significant components of the Company’s net deferred tax assets and liabilities as of December 31, 2018 and 2017 are as follows (in thousands):

	As of December 31,
	2018		2017
Deferred tax assets:
Accrued benefits	$	32,462	$	31,651
Net operating loss carryforward		344,375		122,648
AMT credit carryforward		15,744		23,443
Aircraft credits		35,924		53,870
Accrued reserves and other		18,710		26,647
Total deferred tax assets		447,215		258,259
Valuation allowance		(9,455)		(10,642)
Deferred tax liabilities:
Accelerated depreciation		(955,919)		(666,637)
Total deferred tax liabilities		(955,919)		(666,637)
Net deferred tax liability	$	(518,159)	$	(419,020)

Schedule of unrecognized tax benefits

Unrecognized tax benefits at the beginning of year	$	2,223
Gross increases - current year tax positions		13,899
Gross increases - prior year tax positions		-
Gross decreases - prior year tax positions		(1,569)
Unrecognized tax benefits at end of year	$	14,553
Interest and penalties in year-end balance		-