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Income Taxes | 12 Months Ended
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Dec. 31, 2017
Income Tax Disclosure [Abstract] |
Income Taxes | INCOME TAXES Income tax expense consists of the following:
Year ended December 31, | 2017 |  | 2016 |  | 2015
Current: |  |  |  |  |
Federal | $ | 24.3 |  |  | $ | 40.3 |  |  | $ | 26.7 |
State | 5.0 |  |  | 5.9 |  |  | 4.5 |
Total current | 29.3 |  |  | 46.2 |  |  | 31.2 |
Deferred: |  |  |  |  |
Federal | 18.4 |  |  | 2.9 |  |  | 11.1 |
State | 2.5 |  |  | 0.5 |  |  | 1.4 |
Total deferred | 20.9 |  |  | 3.4 |  |  | 12.5 |
Total income tax expense | $ | 50.2 |  |  | $ | 49.6 |  |  | $ | 43.7 |
Total income tax expense differs from the amount computed by applying the statutory federal income tax rate of 35% in 2017, 2016 and 2015, respectively, to income before income taxes as a result of the following:
Year ended December 31, | 2017 |  | 2016 |  | 2015
Tax expense at the statutory tax rate | $ | 54.9 |  |  | $ | 50.8 |  |  | $ | 45.7 |
Increase (decrease) in tax resulting from: |  |  |  |  |
Tax-exempt income | (4.5 | ) |  | (4.4 | ) |  | (4.1 | )
State income tax, net of federal income tax benefit | 4.9 |  |  | 4.3 |  |  | 3.8 |
Benefit of stock-based compensation plans | (2.6 | ) |  | — |  |  | — |
Federal tax credits | (2.4 | ) |  | (2.1 | ) |  | (2.3 | )
Benefit due to enactment of federal tax reform | (2.2 | ) |  | — |  |  | — |
Other, net | 2.2 |  |  | 1.0 |  |  | 0.6 |
Tax expense at effective tax rate | $ | 50.2 |  |  | $ | 49.6 |  |  | $ | 43.7 |
The tax effects of temporary differences between the financial statement carrying amounts and tax bases of assets and liabilities that give rise to significant portions of the net deferred tax asset (liability) with a tax rate of 21.0% and 35.0% as of December 31, 2017 and December 31, 2016, respectively, relate to the following:
December 31, | 2017 |  | 2016
Deferred tax assets: |  |  |
Loans, principally due to allowance for loan losses | $ | 18.0 |  |  | $ | 30.1 |
Loan discount | 6.7 |  |  | 3.1 |
Investment securities, unrealized losses | 5.6 |  |  | 6.6 |
Employee benefits | 11.5 |  |  | 9.3 |
Non-performing loan interest | 1.1 |  |  | 1.2 |
Other real estate owned write-downs and carrying costs | 0.6 |  |  | 1.3 |
Tax credit carryforwards (1) | 3.7 |  |  | — |
Net operating loss carryforwards (2) | 8.7 |  |  | — |
Other | 4.7 |  |  | 2.5 |
Deferred tax assets | 60.6 |  |  | 54.1 |
Deferred tax liabilities: |  |  |
Fixed assets, principally differences in bases and depreciation | (6.7 | ) |  | (4.7 | )
Deferred loan costs | (1.7 | ) |  | (3.0 | )
Investment in joint venture partnership, principally due to differences in depreciation of partnership assets | (0.8 | ) |  | (1.2 | )
Prepaid amounts | (0.6 | ) |  | (1.5 | )
Government agency stock dividends | (1.6 | ) |  | (2.3 | )
Goodwill and core deposit intangibles | (38.1 | ) |  | (42.4 | )
Mortgage servicing rights | (5.7 | ) |  | (5.5 | )
Other | (1.4 | ) |  | (0.3 | )
Deferred tax liabilities | (56.6 | ) |  | (60.9 | )
Net deferred tax assets (liabilities) | $ | 4.0 |  |  | $ | (6.8 | )
(1) Based on filed tax returns and amounts expected to be reported in current year tax returns (December 31, 2017), we had remaining federal tax credit carryforwards of $3.7 million from acquired companies. The federal tax credits were primarily generated from low income housing and AMT tax credit carryforwards. These tax credits expire beginning in 2027 and ending in 2037 and their use is subject to annual limitations. (2) As of December 31, 2017, we had remaining federal net operating loss carryforwards of $20.1 million from acquired companies, which is available to offset federal taxable income and state net operating loss carryforwards in amounts which vary by state. The federal net operating losses will expire beginning in 2029 and ending in 2037 and the state net operating losses will expire beginning in 2018 and ending in 2031. The use of these carryforwards is subject to annual limitations. The Company had a current net income tax receivable of $5.7 million and $5.8 million at December 31, 2017 and December 31, 2016, respectively. On December 22, 2017, H.R.1, commonly known as the Tax Cuts and Jobs Act (the “Act”), was signed into law. The Act includes many provisions that will affect our income tax expense, including reducing our federal tax rate from 35% to 21%, effective January 1, 2018. As a result of this rate reduction, we are required to re-measure, through income tax expense in the period of enactment, our deferred tax assets and liabilities using the enacted rate at which we expect them to be recovered or settled. This re-measurement resulted in a 2017 income tax benefit of $2.2 million. Also on December 22, 2017, the U.S. Securities and Exchange Commission (“SEC”) released Staff Accounting Bulletin No. 118 (“SAB 118”) to address any uncertainty or diversity of views in practice in accounting for the income tax effects of the Act in situations where a registrant does not have the necessary information available, prepared, or analyzed in reasonable detail to complete this accounting in the reporting period that includes the enactment date. SAB 118 allows for a measurement period, not to extend beyond one year from the Act’s enactment date, to complete the necessary accounting. We recorded provisional amounts of deferred income taxes using reasonable estimates in three areas where the information necessary to determine the final deferred tax asset or liability was either not available, not prepared, or not sufficiently analyzed as of the report filing date: 1) Our deferred tax liability for temporary differences between the tax and financial reporting bases of fixed assets is awaiting completion and implementation of software updates to process the calculations associated with the Act's provisions allowing for 100% bonus depreciation on fixed assets placed in service after September 27, 2017. 2) Our deferred tax assets and liabilities for temporary differences acquired from Cascade Bancorp are awaiting final determinations of those amounts from the Cascade Bancorp 2017 income tax returns. 3) Our deferred tax liability for temporary differences associated with equity investments in partnerships is awaiting the receipt of Schedules K-1 from outside preparers, which is necessary to determine our 2017 tax impact from these investments. In a fourth area, we made no adjustments to deferred tax assets representing future deductions for accrued compensation that may be subject to new limitations under Internal Revenue Code Section 162(m) which, generally, limits the annual deduction for certain compensation paid to certain employees to $1.0 million. As of the report filing date, there is uncertainty regarding how the newly-enacted rules in this area apply to existing contracts. Consequently, we are seeking further clarification of these matters before completing our analysis. We will complete and record the income tax effects of these provisional items during the period the necessary information becomes available. This measurement period will not extend beyond December 22, 2018.

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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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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