Note 6. Income Taxes

Our income tax provision (benefit) is as follows:



	Year Ended December 31,
In thousands	2014			2013			2012
Current income tax expense (benefit)
Federal	$	(42,500	)	$	393		$	57,720
State	(407		)	9,864			18,034
Total current income tax expense (benefit)	(42,907		)	10,257			75,754

Deferred income tax expense (benefit)
Federal	400,544			222,559			239,862
State	29,429			(33		)	15,881
Total deferred income tax expense	429,973			222,526			255,743
Total income tax expense	$	387,066		$	232,783		$	331,497

At December 31, 2014, we had tax-effected federal net operating loss carryforwards ("NOLs") totaling $44.1 million, state NOLs totaling $43.3 million, an estimated $42.8 million of enhanced oil recovery credits to carry forward related to our tertiary operations, and $34.8 million of alternative minimum tax credits. Our state NOLs expire in various years, starting in 2020, although most do not begin to expire until 2024. Our enhanced oil recovery credits will begin to expire in 2024.

At December 31, 2014, we had $13.5 million of excess tax benefits related to stock-based compensation that were not recorded as an increase to additional paid-in capital in the period that the stock award vested and/or was exercised. At the time these excess tax benefits reduce current taxes payable and, thus, are deemed to be realized by the Company, a corresponding increase to additional paid-in capital will be recognized.

Deferred income taxes reflect the available tax carryforwards and the temporary differences based on tax laws and statutory rates in effect at the December 31, 2014 and 2013 balance sheet dates. We believe that we will be able to realize all of our deferred tax assets at December 31, 2014, and, therefore, have provided no valuation allowance against our deferred tax assets.

For federal income tax purposes, we structured the 2012 divestitures of our Bakken area assets and certain non-core assets as like-kind-exchange transactions for interests acquired in Thompson, Webster, Hartzog Draw and LaBarge fields in 2012 and the CCA acquisition in 2013 (see Note 2, Acquisition), thereby deferring the majority of the taxable gain on those divestitures. The higher level of current taxes during 2012 is primarily due to the taxable gain recognized in the late-2012 sale and exchange transaction with Exxon Mobil Corporation and its wholly-owned subsidiary XTO Energy Inc. (the "Bakken Exchange Transaction") that we were unable to defer through a like-kind-exchange transaction.

Significant components of our deferred tax assets and liabilities as of December 31, 2014 and 2013 are as follows:



	December 31,
In thousands	2014			2013
Deferred tax assets
Loss carryforwards – federal	$	44,076		$	20,247
Loss carryforwards – state	43,270			41,379
Tax credit carryover	34,837			34,837
Derivative contracts	—			21,341
Enhanced oil recovery credit carryforwards	42,817			14,974
Stock-based compensation	29,994			34,635
Other	32,656			37,679
Total deferred tax assets	227,650			205,092

Deferred tax liabilities
Property and equipment	(2,806,850		)	(2,541,426		)
Derivative contracts	(185,385		)	—
Other	(11,984		)	(10,206		)
Total deferred tax liabilities	(3,004,219		)	(2,551,632		)
Total net deferred tax liability	$	(2,776,569	)	$	(2,346,540	)

Our reconciliation of income tax expense computed by applying the U.S. federal statutory rate and the reported effective tax rate on income from continuing operations is as follows:



	Year Ended December 31,
In thousands	2014			2013			2012
Income tax provision calculated using the federal statutory income tax rate	$	357,895		$	224,833		$	299,900
State income taxes, net of federal income tax benefit	25,368			13,518			30,955
Effect of statutory rate change	4,225			(4,178		)	(429		)
Other	(422		)	(1,390		)	1,071
Total income tax expense	$	387,066		$	232,783		$	331,497

We file consolidated and separate income tax returns in the U.S. federal jurisdiction and in many state jurisdictions. The statutes of limitation for our income tax returns for tax years ending prior to 2011 have lapsed and therefore are not available for examination by respective taxing authorities. We have not paid any significant interest or penalties associated with our income taxes.