PBF Energy is required to file federal and applicable state corporate income tax returns and recognizes income taxes on its pre-tax income, which to-date has consisted primarily of its share of PBF LLC’s pre-tax income (see “Note 16 - Stockholders’ and Members’ Equity Structure”). PBF LLC is organized as a limited liability company and PBFX is an MLP, both of which are treated as “flow-through” entities for federal income tax purposes and therefore are not subject to income taxes apart from the income tax attributable to the two subsidiaries acquired in connection with the acquisition of Chalmette Refining and PBF Holding’s wholly-owned Canadian subsidiary, PBF Energy Limited, that are treated as C-Corporations for income tax purposes.

Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of existing deferred tax assets. Negative evidence evaluated as part of this assessment included PBF Energy’s cumulative loss incurred over the three-year period ended December 31, 2020. Such objective evidence limits PBF Energy’s ability to consider other subjective evidence, such as PBF Energy’s projections for future taxable income as market conditions, commodity prices and demand for refined petroleum products normalize.

On the basis of this evaluation, as of December 31, 2020, a valuation allowance of $358.4 million has been recorded to recognize only the portion of deferred tax assets that are more likely than not to be realized. The amount of the deferred tax assets considered realizable, however, could be adjusted if estimates of future taxable income are reduced or increased or if objective negative evidence in the form of cumulative losses is no longer present and additional weight is given to subjective evidence such as PBF Energy’s projections for future taxable income.


(in millions)	Year Ended December 31, 2020		Year Ended December 31, 2019		Year Ended December 31, 2018
Current expense (benefit):
Federal	$	(1.7)	$	0.2	$	0.8
Foreign	—		0.1		—
State	2.2		0.3		—
Total current	0.5		0.6		0.8

Deferred expense (benefit):
Federal	(6.6)		91.8		18.7
Foreign	5.4		(8.7)		7.2
State	2.8		20.6		6.8
Total deferred	1.6		103.7		32.7
Total provision for income taxes	$	2.1	$	104.3	$	33.5


	Year Ended December 31, 2020		Year Ended December 31, 2019		Year Ended December 31, 2018

Provision at Federal statutory rate	21.0	%	21.0	%	21.0	%
Increase (decrease) attributable to flow-through of certain tax adjustments:
State income taxes (net of federal income tax)	5.6	%	3.9	%	5.0	%
Nondeductible/nontaxable items	(0.1)	%	0.1	%	1.0	%


Rate differential from foreign jurisdictions	—	%	(0.2)	%	0.9	%
Provision to return adjustment	(0.1)	%	(0.1)	%	(4.0)	%
Adjustment to deferred tax assets and liabilities for change in tax rates	0.1	%	(0.5)	%	—	%
Stock-based compensation	—	%	0.1	%	(2.6)	%
Deferred tax asset valuation allowance	(25.8)	%	—	%	—	%
Other	(0.9)	%	0.3	%	(0.6)	%
Effective tax rate	(0.2)	%	24.6	%	20.7	%

PBF Energy’s effective income tax rate for the years ended December 31, 2020, 2019 and 2018, including the impact of income attributable to noncontrolling interests of $59.1 million, $55.8 million and $47.0 million, respectively, was (0.2)%, 21.8% and 16.0%, respectively.

For the year ended December 31, 2020 PBF Energy’s effective tax rate was affected by the valuation allowance described above. For the year ended December 31, 2019, PBF Energy’s effective tax rate was materially consistent with its statutory federal and state tax rates. For the year ended December 31, 2018, the main drivers of PBF Energy’s reduced effective tax rate related to the treatment of stock-based compensation excess tax benefits under recently adopted ASU No. 2017-09, “Compensation—Stock Compensation”, and the provision to return adjustments primarily attributable to the state business mix apportionment.


(in millions)	Year Ended December 31, 2020		Year Ended December 31, 2019		Year Ended December 31, 2018

United States income (loss)	$	(1,413.0)	$	450.0	$	134.3
Foreign income (loss)	22.7		(26.3)		27.5
Total income (loss) before income taxes attributable to PBF Energy Inc. stockholders	$	(1,390.3)	$	423.7	$	161.8


(in millions)	December 31, 2020		December 31, 2019
Deferred tax assets
Purchase interest step-up	$	155.2	$	278.1
Inventory	146.5		10.5

Pension, employee benefits and compensation	48.5		60.3
Hedging	4.3		3.3
Net operating loss carry forwards	566.9		136.3
Environmental liabilities	100.8		33.6
Lease liabilities	223.4		83.4
Interest expense limitation carry forwards	55.8		31.5
Other	28.4		29.2
Total deferred tax assets	1,329.8		666.2
Valuation allowances	(358.4)		—
Total deferred tax assets, net	971.4		666.2

Deferred tax liabilities
Property, plant and equipment	845.1		678.1

Right of use assets	223.4		83.6
Other	2.5		1.4
Total deferred tax liabilities	1,071.0		763.1

Net deferred tax liabilities	$	(99.6)	$	(96.9)

As of December 31, 2020, PBF Energy has federal and state income tax net operating loss carry forwards of $2,313.0 million and $102.6 million, respectively. The portion of the federal net operating loss carry forward that was generated in years prior to 2018 expires in varying amounts through 2037. A federal net operating loss of $1,764.2 million from 2019 and 2020 has an indefinite carry forward period and can be used to offset 80% of taxable income in future years. The state net operating loss carry forwards expire at various dates from 2029 through 2040 with certain jurisdictions having indefinite net operating loss carry forwards periods. The Company has recorded valuation allowances against these assets, as it is deemed “more likely than not” that the deferred tax assets will not be realized.


(in millions)	Year Ended December 31, 2020		Year Ended December 31, 2019		Year Ended December 31, 2018
Current income tax (benefit) expense	$	(1.2)	$	0.5	$	0.8
Deferred income tax expense (benefit)	7.3		(8.8)		7.2
Total income tax expense (benefit)	$	6.1	$	(8.3)	$	8.0

Income tax years that remain subject to examination by material jurisdictions, where an examination has not already concluded are all years including and subsequent to: