9. Income Taxes

The components of the provision (benefit) for income taxes for the years ended December 31, 2014 and 2013 are as follows:


	Year Ended December 31,
(Thousands of dollars)	2014		2013
Current:
Federal	$	345	$	(462	)
State		262		266

Total current		607		(196	)
Deferred:
Federal		13,134		6,549
State		103		465

Total deferred		13,237		7,014

Total income tax provision	$	13,844	$	6,818

The components of net deferred tax assets and liabilities are as follows:


	At December 31,
(Thousands of dollars)	2014		2013
Current Assets:
Accrued liabilities	$	610	$	683
Allowance for doubtful accounts		124		118
Derivative contracts		52		677

Total current assets		786		1,478
Current Liabilities:
Derivative contracts		6,333		—

Total current liabilities		6,333		—

Net current deferred income tax liabilities (assets)	$	5,547	$	(1,478	)

Non-Current Assets:
Alternative minimum tax credits	$	5,722	$	5,852
Net operating loss carry-forwards		620		168
Percentage depletion carry-forwards		3,959		4,543

Total non-current assets		10,301		10,563
Non-Current Liabilities:
Basis differences relating to managed partnerships		4,300		2,462
Depletion and depreciation		44,192		39,694
Derivative contracts		—		369

Total non-current liabilities		48,492		42,525

Net non-current deferred income tax liabilities	$	38,191	$	31,962

The total provision for income taxes for the years ended December 31, 2014 and 2013 varies from the federal statutory tax rate as a result of the following:


	Year Ended December 31,
(Thousands of dollars)	2014			2013
Expected tax expense	$	13,902		$	6,491
State income tax, net of federal benefit		254			488
Percentage depletion		(312	)		(422	)
Other, net		—			261

Total income tax provision	$	13,844		$	6,818

Deferred income taxes reflect the impact of temporary differences between the amount of assets and liabilities recognized for financial reporting purposes and such amounts recognized for tax purposes. Differences relating to oil and gas properties owned through Prime Offshore are reflected under “Depletion and depreciation,” while basis differences relating to the managed partnerships are reflected under “Basis differences relating to managed partnerships.”

The Company is entitled to percentage depletion on certain of its wells, which is calculated without reference to the basis of the property. To the extent that such depletion exceeds a property’s basis, it creates a permanent difference, which lowers the Company’s effective rate.

The Company has $5.7 million in alternative minimum tax (“AMT”) credits which can be used to lower the regular tax liability to the tentative AMT amount in years where the tentative AMT amount is less. These credits do not expire.

The Company is allowed a credit against the Texas Franchise Tax based on net operating losses incurred in prior periods. The credits allowed are $26 thousand in the years 2014 through 2016, and $89 thousand in the years 2017 through 2026. Any credits not utilized in a given year due to the allowable credit exceeding the tax liability may be carried forward. No credit may be carried forward past 2026. The value of the credit is shown net of the federal income tax effect.

The Company has not recorded any provision for uncertain tax positions. The Company files income tax returns in the U.S. federal jurisdiction and various state and local jurisdictions. The 2004, 2005, 2006, and 2009 federal income tax returns have been audited by the Internal Revenue Service, while the 2011, 2012 and 2013 returns remain open for examination. Returns for unexamined earlier years may be examined and adjustments made to the amount of percentage depletion and AMT credit carryforwards flowing from those years into an open tax year, although in general, no assessment of income tax may be made for those years on which the statute has closed. State returns for the years 2011, 2012 and 2013 remain open for examination by the relevant taxing authorities.