NOTE 10 — INCOME TAXES:

An analysis of our deferred taxes follows:


	As of December 31,
	2013			2012
Tax effect of temporary differences:
Net operating loss carryforwards	$	24,437		$	—
Oil and gas properties – full cost		(576,393	)		(465,862	)
Asset retirement obligations		180,905			175,788
Stock compensation		5,537			5,588
Hedges		826			(16,983	)
Accrued incentive compensation		9,189			4,762
Other		(3,484	)		1,391

		($358,983	)		($295,316	)

We estimate that we have approximately ($10,904), $15,022 and ($20,386) of current federal income tax expense (benefit) for the years ended December 31, 2013, 2012 and 2011, respectively. We have a $7,366 and $10,027 current income tax receivable at December 31, 2013 and 2012, respectively.

For tax reporting purposes, operating loss carryforwards totaled approximately $67,882 at December 31, 2013. If not utilized, such carryforwards would completely expire by the year 2033. In addition, we had approximately $1,453 in statutory depletion deductions available for tax reporting purposes that may be carried forward indefinitely. Recognition of a deferred tax asset associated with these carryforwards is dependent upon our evaluation that it is more likely than not that the asset will ultimately be realized.

A reconciliation between the statutory federal income tax rate and our effective income tax rate as a percentage of income before income taxes follows:


	Year Ended December 31,
	2013			2012			2011
Income tax expense computed at the statutory federal income tax rate		35.0	%		35.0	%		35.0	%
State taxes		1.0			1.0			1.0
IRC Sec. 162(m) limitation		0.8			0.6			0.3
Other		0.1			(0.5	)		(0.3	)

Effective income tax rate		36.9	%		36.1	%		36.0	%

Income taxes allocated to accumulated other comprehensive income related to oil and gas hedges amounted to ($17,003), $3,918 and $20,290 for the years ended December 31, 2013, 2012 and 2011, respectively.

As of December 31, 2013 and 2012, we had unrecognized tax benefits of $0 and $385, respectively. A reconciliation of the total amounts of unrecognized tax benefits follows:


Total unrecognized tax benefits as of December 31, 2012	$	385
Increases (decreases) in unrecognized tax benefits as a result of:		—
Tax positions taken during a prior period		—
Tax positions taken during the current period		—
Settlements with taxing authorities		(385	)
Lapse of applicable statute of limitations		—

Total unrecognized tax benefits as of December 31, 2013	$	—

Our unrecognized tax benefits pertained to proposed state income tax audit adjustments which were settled during 2013. See Note 15 – Commitments and Contingencies for additional information. It is our policy to classify interest and penalties associated with underpayment of income taxes as interest expense and general and administrative expenses, respectively. The liabilities for unrecognized tax benefits and accrued interest payable are components of other current liabilities on our balance sheet.

The tax years 2010 through 2012 remain subject to examination by major tax jurisdictions.