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INCOME TAXES | 9 Months Ended
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Sep. 30, 2022
INCOME TAXES |
INCOME TAXES | 8.INCOME TAXES ​ Components of income tax expense are as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended |
​ | ​ | September 30, | ​ | September 30, | ​
​ | ​ | 2022 |  | 2021 |  | 2022 |  | 2021 |
​ | ​ | (in thousands) | ​
Current: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Federal | ​ | $ | 5,944 | ​ | $ | 2 | ​ | $ | 17,153 | ​ | $ | 1 | ​
State | ​ |  | 387 | ​ |  | — | ​ |  | 1,218 | ​ |  | — | ​
​ | ​ |  | 6,331 | ​ |  | 2 | ​ |  | 18,371 | ​ |  | 1 | ​
Deferred: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Federal | ​ |  | 267 | ​ |  | 188 | ​ |  | 34,932 | ​ |  | 182 | ​
State | ​ |  | 2 | ​ |  | 44 | ​ |  | 2,343 | ​ |  | 44 | ​
​ | ​ |  | 269 | ​ |  | 232 | ​ |  | 37,275 | ​ |  | 226 | ​
Income tax expense | ​ | $ | 6,600 | ​ | $ | 234 | ​ | $ | 55,646 | ​ | $ | 227 | ​
​ Alliance Minerals' Tax Election resulted in the recognition of an initial deferred tax liability of $37.3 million and a corresponding increase to income tax expense for the nine months ended September 30, 2022. This increase in income tax expense reduced net income by $37.3 million, or approximately $0.29 per basic and diluted limited partner unit, for the nine months ended September 30, 2022. Recognition of the initial deferred tax liability and expense is primarily the result of the $177.0 million non-cash acquisition gain recognized in 2019 related to the acquisition of the remaining interests in AllDale Minerals LP ("AllDale I") and AllDale Minerals II, LP ("AllDale II", and collectively with AllDale I, "AllDale I & II") (the "Acquisition Gain"). The Acquisition Gain was recognized to step up to fair value the financial reporting basis of the interests we already owned at the time of acquisition. The tax basis of the underlying properties of AllDale I & II did not include the Acquisition Gain. ​ Reconciliations of income taxes at the U.S. federal statutory tax rate to income taxes at our effective tax rate are as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended |
​ | ​ | September 30, | ​ | September 30, | ​
​ |  | 2022 |  | 2021 |  | 2022 |  | 2021 |
​ | ​ | (in thousands) | ​
Income taxes at statutory rate | ​ | $ | 36,030 | ​ | $ | 12,171 | ​ | $ | 88,066 | ​ | $ | 26,658 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Less: Income taxes at statutory rate on Partnership income not subject to income taxes | ​ |  | (29,888) | ​ |  | (11,777) | ​ |  | (71,562) | ​ |  | (25,935) | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Increase (decrease) resulting from: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
State taxes, net of federal income tax | ​ |  | 426 | ​ |  | 66 | ​ |  | 1,244 | ​ |  | 138 | ​
Change in valuation allowance of deferred tax assets | ​ |  | 9 | ​ |  | (361) | ​ |  | 10 | ​ |  | (666) | ​
Deferred taxes related to tax election | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 37,253 | ​ | ​ | — | ​
Other | ​ |  | 23 | ​ |  | 135 | ​ |  | 635 | ​ |  | 32 | ​
Income tax expense | ​ | $ | 6,600 | ​ | $ | 234 | ​ | $ | 55,646 | ​ | $ | 227 | ​
​ The effective income tax rate for our income tax expense for the three and nine months ended September 30, 2022 is less than the federal statutory rate, primarily due to the portion of income not subject to income taxes, partially offset by the effect of the Tax Election previously discussed. The effective income tax rate for our income tax expense for the three and nine months ended September 30, 2021 is less than the federal statutory rate, primarily due to the portion of income not subject to income taxes. ​ Significant components of deferred tax liabilities and deferred tax assets are as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, | ​ | December 31, |
​ |  | 2022 |  | 2021 |
​ | ​ | (in thousands) | ​
Deferred tax liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​
Property, plant and equipment | ​ | $ | (38,770) | ​ | $ | (2,169) | ​
Total deferred tax liabilities | ​ | ​ | (38,770) | ​ | ​ | (2,169) | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Deferred tax assets: | ​ | ​ | ​ | ​ | ​ | ​ | ​
Federal loss carryovers and credits | ​ | ​ | 734 | ​ | ​ | 1,328 | ​
Other | ​ |  | 764 | ​ |  | 808 | ​
Total deferred tax assets | ​ | ​ | 1,498 | ​ | ​ | 2,136 | ​
Less valuation allowance | ​ | ​ | (327) | ​ | ​ | (317) | ​
Net deferred tax assets | ​ | ​ | 1,171 | ​ | ​ | 1,819 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Overall net deferred tax liabilities | ​ | $ | (37,599) | ​ | $ | (350) | ​
​ The change in deferred tax liabilities for property, plant and equipment is primarily as a result of the Alliance Minerals' Tax Election and associated impact of the Acquisition Gain discussed above. ​ Federal loss carryovers and credits are primarily due to net operating losses and research and development credits associated with the operations of other subsidiaries that are taxable for federal income tax purposes. ​ The valuation allowance as of September 30, 2022 and 2021 serves to reduce the available deferred tax assets to amounts that will, more likely than not, be realized. We considered all available positive and negative evidence, which incorporates available tax planning strategies and our estimate of future reversals of existing temporary differences, and have determined that a portion of our deferred tax assets relating to state losses and credits may not be realized. ​ Our 2019 through 2021 tax years remain open to examination by tax authorities. We have been notified by the Internal Revenue Service that lower-tier partnership income tax returns for the tax year ended December 31, 2020 have been selected for audit.

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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/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI https://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI https://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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