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Income Taxes
 12 Months Ended
Dec. 31, 2019
Income Tax Disclosure [Abstract]  
Income Taxes INCOME TAXES
The following table presents the 2019, 2018 and 2017 income tax expense (benefit):
 
Year Ended December 31
 
2019
 
2018(1)
 
2017(2)
 
(In thousands)
Current income taxes:
 
 
 
 
 
Federal
$
(4,624
)
 
$
(258
)
 
$
(1,315
)
State
1,015

 
33

 
1,317

Foreign
536

 
(554
)
 
844

Total current income tax expense (benefit)
(3,073
)
 
(779
)
 
846

Deferred income taxes:
 
 
 
 
 
Federal
(9,928
)
 
(49,115
)
 
(38,100
)
State
3,806

 
7,611

 
11,075

Total deferred income tax expense (benefit)
(6,122
)
 
(41,504
)
 
(27,025
)
Total income tax expense (benefit)
$
(9,195
)
 
$
(42,283
)
 
$
(26,179
)
(1)
Excludes $5.9 million of income tax benefit related to discontinued operations.
(2)
Excludes $14.2 million of income tax expense related to discontinued operations.
The following is a reconciliation of income tax expense (benefit) computed at the U.S. federal statutory tax rate to income tax expense (benefit) reported in our Consolidated Statements of Operations:
 
Year Ended December 31
 
2019
 
2018
 
2017
 
Amount
 
Percentage
 
Amount
 
Percentage
 
Amount
 
Percentage
 
(In thousands, except percentages)
Tax expense (benefit) at statutory rate
$
(107,085
)
 
21.0
 %
 
$
(78,648
)
 
21.0
 %
 
$
7,435

 
35.0
 %
State income taxes
(22,042
)
 
4.3

 
(17,159
)
 
4.6

 
1,844

 
8.7

Uncertain tax position
(3,549
)
 
0.7

 
—

 
—

 
—

 
—

Corporate owned life insurance
—

 
—

 
(85
)
 
—

 
(933
)
 
(4.4
)
Nondeductible executive compensation
1,753

 
(0.3
)
 
566

 
(0.1
)
 
371

 
1.8

Impairment
—

 
—

 
35,109

 
(9.4
)
 
—

 
—

Change in valuation allowances
118,126

 
(23.2
)
 
17,355

 
(4.6
)
 
5,851

 
27.5

Share-based compensation(1)
—

 
—

 
1,073

 
(0.3
)
 
2,995

 
14.1

Domestic production activities deduction
—

 
—

 
—

 
—

 
(244
)
 
(1.2
)
Transition tax on unrepatriated foreign earnings
—

 
—

 
—

 
—

 
2,106

 
9.9

Tax reform revaluation of deferred taxes
—

 
—

 
—

 
—

 
(45,840
)
 
(215.8
)
Other
3,602

 
(0.7
)
 
(494
)
 
0.1

 
236

 
1.2

Total
$
(9,195
)
 
1.8
 %
 
$
(42,283
)
 
11.3
 %
 
$
(26,179
)
 
(123.2
)%
(1)
Includes excess tax benefits and deficiencies related to share-based payments recorded in the provision of income taxes because of the adoption of ASU 2016-09, Compensation — Stock Compensation — Improvements to Employee Share-Based Payment Accounting in 2017.
The tax effects of temporary differences giving rise to deferred income tax assets (liabilities) were:
 
December 31
 
2019(1)
 
2018(2)
 
(In thousands)
Deferred income tax assets:
 
 
 
Accrued liabilities
$
44,541

 
$
54,906

Retirement plans and postretirement benefits
10,751

 
12,190

Share-based compensation
452

 
2,343

Receivables and inventories
7,182

 
6,789

Derivative financial instruments
198

 
1,075

Net operating loss carryforwards
137,138

 
61,009

Tax credits and other carryforwards
32,707

 
23,195

Lease liability
72,907

 
—

Valuation allowances
(155,841
)
 
(40,966
)
 
150,035

 
120,541

Deferred income tax liabilities:
 
 
 
Property, plant and equipment
(74,247
)
 
(113,272
)
Operating lease right of use assets
(69,340
)
 
—

Intangible assets
(5,603
)
 
(14,475
)
Prepaid expenses
(5,002
)
 
—

Other
(909
)
 
(3,983
)
 
(155,101
)
 
(131,730
)
Net deferred income tax asset (liability)
$
(5,066
)
 
$
(11,189
)
(1)
Includes $4.4 million of deferred tax assets related to uncertain tax positions.
(2)
Includes $5.4 million of deferred tax assets related to uncertain tax positions.
These net deferred income tax assets (liabilities) are classified in our Consolidated Balance Sheets as follows:
 
December 31
 
2019
 
2018
 
(In thousands)
Noncurrent assets
$
—

 
$
2,518

Noncurrent liabilities
(5,066
)
 
(13,707
)
Total
$
(5,066
)
 
$
(11,189
)
At December 31, 2019, we had $137.1 million of tax-effected federal and state net operating losses and $32.7 million of federal and state tax credits and other carryovers available for use in future years. These items are subject to certain limitations, and a portion will begin to expire in 2020. A valuation allowance of $155.8 million has been established because we do not believe it is more likely than not that all federal and state deferred tax assets will be realized. Our valuation allowance increased $114.9 million in 2019, which primarily relates to our assessment of the realizability of our net deferred federal and state tax assets, as well as certain federal and state net operating losses and tax credits.
The following is a reconciliation of gross unrecognized tax benefits, including interest, recorded in our Consolidated Balance Sheets:
 
December 31
 
2019
 
2018
 
2017
 
(In thousands)
Balance at beginning of year
$
9,450

 
$
15,054

 
$
30,410

Increases in tax positions for current year
73

 
211

 
251

Increases in tax positions for prior years
5,159

 
244

 
904

Decreases in tax positions for prior years
(6,674
)
 
(5,842
)
 
(53
)
Settlement of tax matters
—

 
(217
)
 
—

Lapse of applicable statutes of limitations
(3,227
)
 
—

 
(16,458
)
Balance at end of year
$
4,781

 
$
9,450

 
$
15,054

Of the total unrecognized tax benefit balance at December 31, 2019, $0.4 million would impact our effective tax rate if recognized. The remaining $4.4 million represents tax positions for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility. Due to the impact of deferred income tax accounting, the disallowance of the shorter deductibility period would not affect our effective tax rate but would accelerate payment of cash to the applicable taxing authority. We do not expect a material change to our gross liability for uncertain tax positions during the next 12 months.
We recognize accrued interest related to uncertain tax positions as a component of income tax expense. Penalties, if incurred, are recorded in general and administrative expenses in our Consolidated Statements of Operations. Interest expense recorded in income tax expense for 2019, 2018 and 2017 was immaterial. Our liability for uncertain tax positions included accrued interest of $0.2 million and $0.8 million at December 31, 2019 and 2018, respectively.
As of December 31, 2019, our 2016 through 2018 U.S. consolidated income tax returns remain open for examination by the IRS. State income tax returns are generally subject to examination for a period of three to five years after filing.