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Provision for Taxes | 12 Months Ended
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Mar. 31, 2019
Disclosure Text Block [Abstract] |
Provision for Taxes | Earnings before taxes and the provision for taxes consisted of the following:
|  | Years Ended March 31,
|  | 2019 |  | 2018 |  | 2017
|  | (In thousands)
Pretax earnings: |  |  |  |  |  |
U.S. | $ | 466,175 | $ | 628,901 | $ | 609,589
Non-U.S. |  | 11,354 |  | 8,712 |  | 18,769
Total pretax earnings | $ | 477,529 | $ | 637,613 | $ | 628,358
Current provision (benefit) |  |  |  |  |  |
Federal | $ | (6,114) | $ | 21,780 | $ | 38,723
State |  | 3,420 |  | 6,471 |  | 10,818
Non-U.S. |  | 1,375 |  | 1,412 |  | 3,334
|  | (1,319) |  | 29,663 |  | 52,875
Deferred provision (benefit) |  |  |  |  |  |
Federal |  | 94,961 |  | (199,415) |  | 160,527
State |  | 11,311 |  | 15,479 |  | 15,210
Non-U.S. |  | 1,719 |  | 1,303 |  | 1,322
|  | 107,991 |  | (182,633) |  | 177,059
Provision for income tax expense (benefit) | $ | 106,672 | $ | (152,970) | $ | 229,934
Income taxes paid (net of income tax refunds received) | $ | 4,255 | $ | 68,671 | $ | 36,880
The difference between the tax provision at the statutory federal income tax rate and the tax provision attributable to income before taxes was as follows:
|  | Years Ended March 31,
|  | 2019 |  | 2018 |  | 2017
Statutory federal income tax rate |  | 21.00% |  | 31.55% |  | 35.00%
Increase (reduction) in rate resulting from: |  |  |  |  |  |
Deferred tax liability revaluation |  | 0.00% |  | (58.25)% |  | 0.00%
State taxes, net of federal benefit |  | 2.41% |  | 2.33% |  | 2.66%
Foreign rate differential |  | 0.15% |  | 0.00% |  | (0.31)%
Federal tax credits |  | (0.15)% |  | (0.32)% |  | (0.41)%
Transition tax |  | (0.20)% |  | 1.83% |  | 0.00%
Dividend received deduction |  | (0.01)% |  | (0.03)% |  | (0.03)%
Phase III tax |  | 0.00% |  | 0.63% |  | 0.00%
Other |  | (0.86)% |  | (1.73)% |  | (0.32)%
Actual tax expense (benefit) of operations |  | 22.34% |  | (23.99)% |  | 36.59%
Significant components of our deferred tax assets and liabilities were as follows:
|  | March 31,
|  | 2019 |  | 2018
|  | (In thousands)
Deferred tax assets: |  |  |  |
Net operating loss and credit carry forwards | $ | 90,061 | $ | 3,136
Accrued expenses |  | 105,727 |  | 104,309
Policy benefit and losses, claims and loss expenses payable, net |  | 16,515 |  | 11,148
Total deferred tax assets | $ | 212,303 | $ | 118,593
Deferred tax liabilities: |  |  |  |
Property, plant and equipment | $ | 940,433 | $ | 741,607
Deferred policy acquisition costs |  | 14,191 |  | 12,995
Unrealized gains |  | 4,223 |  | 18,863
Other |  | 4,426 |  | 3,236
Total deferred tax liabilities |  | 963,273 |  | 776,701
Net deferred tax liability | $ | 750,970 | $ | 658,108
The net operating loss (“NOL”) and credit carry-forwards in the above table are primarily attributable to $358.9 million of federal NOLs and $172.3 million of state NOLs. The federal NOL consists of $266.8 million as of March 31, 2019, and $92.1 million as of March 31, 2018. The federal NOL as of March 31, 2019 has an indefinite life, but is subject to the single tax year limitation under section 172 (a) equal to the lesser of available NOL carryover or 80% of a taxpayer's pre-NOL deduction taxable income (the "80% limitation"). The federal NOL as of March 31, 2018 is not limited and can be carried forward to offset taxable income for 20 years. As of March 31, 2019 and March 31, 2018, AMERCO had state NOLs of $172.3 million and $45.3 million, respectively, that will begin to expire March 31, 2020, if not utilized. The Tax Cuts and Jobs Act (the “Tax Reform Act”) was enacted on December 22, 2017. The Tax Reform Act reduced the U.S. federal corporate income tax rate from 35% to 21%, required companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred, and repealed the deferral of the phase three tax for life insurance companies. The blended statutory Federal Tax Rate for our full fiscal year ended March 31, 2018 was 31.55%. As of December 22, 2018, we have completed our accounting for the tax effects of enactment of the Tax Reform Act. For the fiscal year ended March 31, 2018, we recognized a benefit amount of $356.6 million which was included as a component of income tax expense from continuing operations. For the fiscal year ended March 31, 2018, we re-measured certain tax deferred assets and liabilities based on the rates they are expected to reverse in the future, which is generally 21%. The amount recorded related to the re-measurement of our deferred tax balance was a benefit of $371.5 million for the fiscal year ended March 31, 2018. As of December 31, 2017, we elected to reclassify the income tax effects of the Tax Reform Act in the amount of $8.7 million from accumulated other comprehensive income to retained earnings under ASU 2018-02. In addition, we have adopted the “investment by investment” approach with regard to releasing disproportionate income tax effects from accumulated other comprehensive income. For the fiscal year ended March 31, 2018, we calculated and recorded a one-time transition tax on earnings from foreign subsidiaries based on the post 1986 earnings and profits (“E&P”) of our Canadian subsidiaries that were previously deferred from U.S. income taxes. The effect of this one-time transition tax liability for our foreign subsidiaries resulted in an increase in income tax expense of $10.7 million for the fiscal year ended March 31, 2018. No additional income taxes have been provided for any remaining undistributed foreign earnings not subject to transition tax, or any additional outside basis difference inherent in these entities, as these amounts continue to be indefinitely reinvested in foreign operations. Determining the amount of unrecognized deferred tax liability related to any remaining undistributed foreign earnings not subject to the transition tax and additional outside basis difference in these entities (i.e., basis difference in excess of that subject to the one-time transition tax) is not practicable. The Tax Reform Act repeals the special rules with regard to distribution to shareholders from pre-1984 policyholders surplus account. This one-time tax was based on the balance of our pre-1984 policyholder surplus account. We reported the amount of our one-time tax liability for Phase Three Tax, resulting in an increase in income tax expense of $4.2 million for the fiscal year ended March 31, 2018. ASC 740 prescribes a minimum recognition and measurement methodology that a tax position is required to meet before being recognized in the financial statements. A reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period are as follows:
|  | Unrecognized Tax Benefits
|  | March 31,
|  | 2019 |  | 2018
|  | (In thousands)
Unrecognized tax benefits beginning balance | $ | 35,739 | $ | 26,720
Revaluation based on change in after tax benefit |  | – |  | 5,755
Additions based on tax positions related to the current year |  | 1,887 |  | 4,139
Reductions for tax positions of prior years |  | (46) |  | (96)
Settlements |  | (379) |  | (779)
Unrecognized tax benefits ending balance | $ | 37,201 | $ | 35,739
We recognize interest related to unrecognized tax benefits as interest expense, and penalties as operating expenses. At March 31, 2019 and 2018, the amount of interest and penalties accrued on unrecognized tax benefits was $9.5 million and $8.5 million, net of tax. During the current year we recorded expense from interest and penalties in the amount of $1.0 million, net of tax. We file income tax returns in the U.S. federal jurisdiction, and various states and foreign jurisdictions. With some exceptions, we are no longer subject to audit for years prior to the fiscal year ended March 31, 2016.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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