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Income Taxes | 12 Months Ended
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Dec. 31, 2018
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes On December 22, 2017, the Tax Cuts and Jobs Act (the “2017 Tax Act”) was enacted, substantially changing the U.S. tax system. The 2017 Tax Act includes a number of changes to existing U.S. tax laws that impact the Company, most notably a reduction of the U.S. corporate income tax rate from 35 percent to 21 percent for tax years beginning after December 31, 2017. The 2017 Tax Act also provides immediate expensing for certain qualified assets acquired and placed into service after September 27, 2017 as well as prospective changes beginning in 2018, including acceleration of tax revenue recognition, additional limitations on deductibility of executive compensation and limitations on the deductibility of interest. On December 22, 2017, the SEC staff issued Staff Accounting Bulletin No. 118 (SAB 118) to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed in reasonable detail to complete the accounting for certain income tax effects of the 2017 Tax Act. The Company recognized a provisional benefit on the income tax effects of the 2017 Tax Act in its 2017 financial statements in accordance with SAB No. 118. The Company measures deferred tax assets and liabilities using enacted tax rates that will apply in the years in which the temporary differences are expected to be recovered or paid. Accordingly, the Company's deferred tax assets and liabilities were remeasured to reflect the reduction in the U.S. corporate income tax rate from 35 percent to 21 percent, resulting in a $53.4 million income tax benefit for the year ended December 31, 2017 and a corresponding $53.4 million decrease in net deferred tax liabilities as of December 31, 2017. The Company completed the accounting for the effects of the 2017 Tax Act during the one-year measurement period prescribed by SAB No. 118. As of December 31, 2018, the Company adjusted the provisional amounts recorded at December 31, 2017 by recording an additional $0.8 million of income tax benefit and a corresponding $0.8 million decrease in net deferred tax liabilities upon completing the analysis of the 2017 Tax Act and the filing of the 2017 federal income tax return. Total income taxes were as follows:
| Years Ended December 31,
(in thousands) | 2018 |  | 2017 |  | 2016
Income tax (benefit) expense | $ | 15,517 |  |  | $ | (53,133 | ) |  | $ | 2,840 |
Other comprehensive income for changes in cash flow hedge | 16 |  |  | 522 |  |  | 4,162 |
| $ | 15,533 |  |  | $ | (52,611 | ) |  | $ | 7,002 |
The Company and its subsidiaries file income tax returns in several jurisdictions. The provision for the federal and state income taxes attributable to income (loss) consists of the following components:
| Years Ended December 31,
(in thousands) | 2018 |  | 2017 |  | 2016
Current expense |  |  |  |  |
Federal taxes | $ | 2,875 |  |  | $ | 1,552 |  |  | $ | 44,779 |
State taxes | 6,434 |  |  | (630 | ) |  | 10,936 |
Total current provision | 9,309 |  |  | 922 |  |  | 55,715 |
Deferred expense (benefit) |  |  |  |  |
Federal taxes | 6,708 |  |  | (52,886 | ) |  | (47,056 | )
State taxes | (500 | ) |  | (1,169 | ) |  | (5,819 | )
Total deferred provision | 6,208 |  |  | (54,055 | ) |  | (52,875 | )
Income tax expense (benefit) | $ | 15,517 |  |  | $ | (53,133 | ) |  | $ | 2,840 |
Effective tax rate | 25.0 | % |  | (400.8 | )% |  | 146.0 | %
A reconciliation of income taxes determined by applying the federal and state tax rates to income (loss) is as follows:
| Years Ended December 31,
(in thousands) | 2018 |  | 2017 |  | 2016
Computed "expected" tax expense | $ | 13,044 |  |  | $ | 4,640 |  |  | $ | 681 |
State income taxes, net of federal tax effect | 4,748 |  |  | (1,129 | ) |  | 6 |
Changes in state DTL for mergers | — |  |  | — |  |  | 3,320 |
Excess share based compensation | (1,254 | ) |  | (3,314 | ) |  | (1,709 | )
Nondeductible merger expenses | — |  |  | — |  |  | 801 |
Revaluation of U.S. deferred income taxes | (760 | ) |  | (53,449 | ) |  | — |
Other, net | (261 | ) |  | 119 |  |  | (259 | )
Income tax expense (benefit) | $ | 15,517 |  |  | $ | (53,133 | ) |  | $ | 2,840 |
The effective tax rate increased in 2018 primarily due to the recognition of a one-time non-cash tax benefit of $53.4 million in 2017 related to the revaluation of deferred tax assets and liabilities as a result of the 2017 Tax Act. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and tax purposes. Net deferred tax assets and liabilities are classified as non-current in the consolidated balance sheets. Net deferred tax assets and liabilities consist of the following temporary differences:
(in thousands) | December 31, 2018 |  | December 31, 2017
Deferred tax assets: |  |  |
Deferred revenue | $ | — |  |  | $ | 3,907 |
Net operating loss carry-forwards | 12,612 |  |  | 14,983 |
Accruals and reserves | 6,545 |  |  | 5,189 |
Pension benefits | 2,873 |  |  | 3,556 |
Asset retirement obligations | 7,797 |  |  | 4,608 |
Total gross deferred tax assets | 29,827 |  |  | 32,243 |
Less valuation allowance | (862 | ) |  | (862 | )
Net deferred tax assets | 28,965 |  |  | 31,381 |
Deferred tax liabilities: |  |  |
Deferred revenue | 19,554 |  |  | — |
Plant-in-service | 99,666 |  |  | 89,494 |
Intangible assets | 32,963 |  |  | 37,682 |
Interest rate swaps | 3,339 |  |  | 3,511 |
Other, net | 896 |  |  | 1,573 |
Total gross deferred tax liabilities | 156,418 |  |  | 132,260 |
Net deferred tax liabilities | $ | 127,453 |  |  | $ | 100,879 |
In assessing the ability to realize deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon generating future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, taxable income in prior carryback years if available and tax planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods for which the deferred tax assets are deductible, the Company believes it more likely than not that the net deferred tax assets will be realized with the exception of certain state net operating losses in jurisdictions where the Company no longer operates. The Company has a deferred tax asset of $12.6 million related to federal and various state net operating losses, of which $0.9 million is associated with a valuation allowance. As of December 31, 2018, the Company had approximately $54.4 million of federal net operating losses expiring through 2035. The Company also had approximately $39.9 million of state net operating losses expiring through 2036. As of December 31, 2018 and 2017, the Company had no unrecognized tax benefits. It is the Company’s policy to record interest and penalties related to unrecognized tax benefits in selling, general, and administrative expenses. The Company files U.S. federal income tax returns and various state and local income tax returns. The Company is not currently subject to state or federal income tax audits as of December 31, 2018. The Company's returns are generally open to examination from 2015 forward and the net operating losses acquired in the acquisition of nTelos are open to examination from 2002 forward.

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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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