Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

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,
	2019		2018		2017
Current tax provision (benefit):
Federal	$	(4,395)	$	(21,598)	$	5,853
State		891		1,465		180
Foreign		—		1,575		—
		(3,504)		(18,558)		6,033
Deferred tax provision (benefit):
Federal		95,655		92,250		(166,890)
State		14,055		12,250		20,133
		109,710		104,500		(146,757)
Provision (benefit) for income taxes	$	106,206	$	85,942	$	(140,724)

Schedule of income tax rate reconciliation

The following is a reconciliation between a federal income tax rate of 21% in 2019 and 2018 and 35% for 2017 of income before income taxes and the effective tax rate which is derived by dividing the provision (benefit) for income taxes by the income before the provision for income taxes (in thousands):

	Year ended December 31,
	2019		2018		2017
Computed provision for income taxes at the statutory rate	$	93,724	$	76,926	$	100,864
Increase (decrease) in income taxes resulting from:
State income tax provision, net of federal income tax benefit		15,645		12,711		7,778
Non-deductible expenses		3,934		1,956		3,230
Valuation allowance changes affecting the provision for income taxes		(517)		(1,187)		505
Foreign income taxes, net of federal & state benefit		—		1,192		—
Excess tax benefits from share-based compensation		(3,525)		(4,548)		(5,377)
Revaluation of net deferred taxes for the Tax Cuts and Jobs Act of 2017		—		—		(246,845)
Other, net		(3,055)		(1,108)		(879)
Provision (benefit) for income taxes	$	106,206	$	85,942	$	(140,724)

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, 2019 and 2018 are as follows (in thousands):

	As of December 31,
	2019		2018
Deferred tax assets:
Accrued benefits	$	20,848	$	32,462
Net operating loss carryforward		358,685		344,375
AMT credit carryforward		4,397		15,744
Aircraft credits		9,114		35,924
Accrued reserves and other		17,225		18,710
Total deferred tax assets		410,269		447,215
Valuation allowance		(892)		(9,455)
Deferred tax liabilities:
Accelerated depreciation		(1,032,957)		(955,919)
Total deferred tax liabilities		(1,032,957)		(955,919)
Net deferred tax liability	$	(623,580)	$	(518,159)

Schedule of unrecognized tax benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits for the year ended December 31, 2019 and 2018 is as follows (in thousands):

	As of December 31,
	2019		2018
Unrecognized tax benefits at the beginning of year	$	14,553	$	2,223
Gross increases - current year tax positions		—		13,899
Gross increases - prior year tax positions		67		—
Gross decreases - prior year tax positions		—		(1,569)
Unrecognized tax benefits at end of year	$	14,620	$	14,553
Interest and penalties in year-end balance	$	67	$	—