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Income Taxes | 12 Months Ended
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Dec. 31, 2016
Income Tax Disclosure [Abstract] |
Income Tax Disclosure | INCOME TAXES The provision for income taxes from continuing operations for the years ended December 31, 2014, 2015 and 2016 consisted of (in thousands):
| Year Ended December 31,
| 2014 |  | 2015 |  | 2016
Current: |  |  |  |  |
U. S. federal provision | $ | 1,188 |  |  | $ | 9,840 |  |  | $ | 6,609 |
State provision | 772 |  |  | 862 |  |  | 1,195 |
Total current provision | $ | 1,960 |  |  | $ | 10,702 |  |  | $ | 7,804 |
Deferred: |  |  |  |  |
U. S. federal provision | $ | 5,117 |  |  | $ | 1,928 |  |  | $ | 3,475 |
State provision | 178 |  |  | 1,107 |  |  | 1,381 |
Total deferred provision | $ | 5,295 |  |  | $ | 3,035 |  |  | $ | 4,856 |
Total income tax provision | $ | 7,255 |  |  | $ | 13,737 |  |  | $ | 12,660 |
A reconciliation of taxes from continuing operations calculated at the U.S. federal statutory rate to those reflected in the Consolidated Statements of Operations for the years ended December 31, 2014, 2015 and 2016 is as follows (dollars in thousands):
| Year Ended December 31, |
| 2014 |  | 2015 |  | 2016 |
| Amount |  | Percent |  | Amount |  | Percent |  | Amount |  | Percent |
Federal statutory rate | $ | 7,719 |  |  | 34.0 |  | % | $ | 12,105 |  |  | 35.0 |  | % | $ | 11,300 |  |  | 35.0 | %
Effect of state income taxes, net of federal benefit | 831 |  |  | 3.7 |  |  | 1,618 |  |  | 4.7 |  |  | 1,127 |  |  | 3.5 |
Effect of non-deductible expenses and other, net | 583 |  |  | 2.6 |  |  | 155 |  |  | 0.4 |  |  | 213 |  |  | 0.7 |
Change in valuation allowance | (138 | ) |  | (0.6 | ) |  | (141 | ) |  | (0.4 | ) |  | 20 |  |  | 0.1 |
Reduction for tax year 2011 federal audit | (1,740 | ) |  | (7.7 | ) |  | — |  |  | — |  |  | — |  |  | — |
Total | $ | 7,255 |  |  | 32.0 |  | % | $ | 13,737 |  |  | 39.7 |  | % | $ | 12,660 |  |  | 39.3 | %
On August 1, 2014, we received notification that the IRS completed its examination of our tax year ended December 31, 2011. As a result, we re-measured our tax liability for unrecognized tax benefits reflecting a reduction to our liability by $7.3 million. This change resulted in a tax benefit recognized in the amount of $1.7 million which reduced our effective tax rate for the year ended December 31, 2015. The remainder of the re-measurement resulted in an increase to Deferred tax liability in the amount of $5.6 million. Additionally, we recognized a credit to interest expense of $0.6 million related to the settled portion of the uncertain tax position. On August 15, 2016, we settled an open examination with the California Franchise Tax Board. As a result of paying the final assessment, we re-measured our tax liability for unrecognized tax benefits reflecting a reduction to our liability of $0.2 million. On August 29, 2016, we received notification that the IRS completed its examination of our tax year ended December 31, 2013. As a result, we re-measured our tax liability for unrecognized tax benefits reflecting a reduction to our liability of $0.6 million, which resulted in an increase to Deferred tax liability in the amount of $0.6 million. The following table summarizes our unrecognized tax benefit as of December 31, 2015 and 2016 (in thousands):
|  | December 31, 2015 |  | December 31, 2016
Unrecognized tax benefit |  | $ | 814 |  |  | $ | — |
Interest accrued on unrecognized tax benefits |  | $ | 44 |  |  | $ | — |
The tax effects of temporary differences from total operations that give rise to significant deferred tax assets and liabilities at December 31, 2015 and 2016 were as follows (in thousands):
| Year Ended December 31,
| 2015 |  | 2016
Deferred income tax assets: |  |  |
Net operating loss carryforwards | $ | 2,132 |  |  | $ | 1,947 |
Tax credit carryforwards | 133 |  |  | 135 |
State bonus depreciation | 993 |  |  | 373 |
Accrued liabilities and other | 9,949 |  |  | 11,163 |
Amortization of non-compete agreements | 897 |  |  | 1,433 |
Preneed liabilities, net | 10,324 |  |  | 9,315 |
Total deferred income tax assets | 24,428 |  |  | 24,366 |
Less valuation allowance | (189 | ) |  | (209 | )
Total deferred income tax assets | $ | 24,239 |  |  | $ | 24,157 |
Deferred income tax liabilities: |  |  |
Amortization and depreciation | $ | (48,318 | ) |  | $ | (55,461 | )
Convertible subordinated notes due 2021 | (10,184 | ) |  | (8,636 | )
Prepaids and other | (1,436 | ) |  | (615 | )
Total deferred income tax liabilities | (59,938 | ) |  | (64,712 | )
Total net deferred tax liabilities | $ | (35,699 | ) |  | $ | (40,555 | )
Current deferred tax asset | $ | 4,257 |  |  | $ | — |
Non-current deferred tax liabilities | (39,956 | ) |  | (40,555 | )
Total net deferred tax liabilities | $ | (35,699 | ) |  | $ | (40,555 | )
Beginning January 1, 2016, we adopted the FASB’s guidance on Balance Sheet Classification of Deferred Taxes, which simplifies deferred tax reporting on the balance sheet and requires all deferred tax assets and liabilities, along with related valuation allowances will be classified as non-current on the balance sheet. The guidance was applied prospectively and all deferred tax assets and liabilities, along with our valuation allowance are now classified as non-current at December 31, 2016. At December 31, 2015, our current deferred tax asset is included in Other current assets and the non-current deferred tax liability is disclosed on a separate line item on our Consolidated Balance Sheets. At December 31, 2016, our total net deferred tax liability is disclosed as a separate line item on our Consolidated Balance Sheets and is classified as a non-current liability. We record a valuation allowance to reflect the estimated amount of deferred tax assets for which realization is uncertain. Management reviews the valuation allowance at the end of each quarter and makes adjustments if it is determined that it is more likely than not that the tax benefits will be realized. We recognized a net increase of approximately $20,000 in our valuation allowance during 2016. For federal income tax reporting purposes, we have no net operating loss carryforwards. For state reporting purposes, we have approximately $43.2 million of net operating loss carryforwards that will expire between 2017 and 2036, if not utilized. Based on management’s assessment of the various state net operating losses, it was determined that it is more likely than not that we will be able to realize tax benefits on some portion of the amount of the state losses. The valuation allowance at December 31, 2016 was attributable to the deferred tax asset related to a portion of the state operating losses. We analyze tax benefits for uncertain tax positions and how they are to be recognized, measured, and derecognized in financial statements; provide certain disclosures of uncertain tax matters; and specify how reserves for uncertain tax positions should be classified on the Consolidated Balance Sheets. During 2016, the re-measurement of the tax liability for unrecognized tax benefits arising from the finalization of our IRS and California Franchise Tax Board exams, resulted in an $0.8 million reduction to our liability related to uncertain tax positions. We do not have any unrecognized tax benefits recorded as of December 31, 2016 and we do not anticipate a material change in our unrecognized tax benefits during the next twelve months. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands):
| Year Ended December 31,
| 2014 |  | 2015 |  | 2016
Unrecognized tax benefit at beginning of year | $ | 7,832 |  |  | $ | 515 |  |  | $ | 814 |
Reductions based on tax positions related to the prior year | — |  |  | — |  |  | (17 | )
Reductions for tax year 2011 federal audit | (7,310 | ) |  | — |  |  | (568 | )
Additions (reductions) based on tax positions related to the current year | — |  |  | 299 |  |  | (229 | )
Reductions as a result of a lapse of the applicable statute of limitations | (7 | ) |  | — |  |  | — |
Unrecognized tax benefit at end of year | $ | 515 |  |  | $ | 814 |  |  | $ | — |
Our federal income tax returns for 2014 and 2015 are open tax years that may be examined by the IRS.

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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 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32559-109319 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32718-109319 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32639-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32537-109319 + Details
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