INCOME TAXES

The Company recorded an income tax benefit of $2.1 million for the six months ended March 31, 2019, resulting in an effective tax rate of (4.40%), compared to an income tax expense of $12.2 million, or an effective tax rate of 25.31%, for the six months ended March 31, 2018. The Company’s effective tax rate is lower than the U.S. statutory rate of 21% primarily because of the anticipated effect of investment tax credits during fiscal year 2019. The Company’s effective tax rate in the future will depend in part on actual investment tax credits earned as part of its financing of solar energy projects.

The table below compares the income tax expense components for the periods presented.



Six Months Ended March 31,	2019			2018
(Dollars in Thousands)
Provision at statutory rate	$	9,541		$	11,857
Tax-exempt income	(1,824		)	(3,728		)
State income taxes	2,143			2,003
Interim period effective rate adjustment	(3,968		)	(1,277		)
Tax credit investments, net - federal	(9,568		)	—
Tax Reform rate adjustment	—			3,635
IRC 162(m) nondeductible compensation	1,561			—
Other, net	29			(258		)
Income tax expense	$	(2,086	)	$	12,232
Effective tax rate	(4.40		%)	25.31		%