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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 President signed the Tax Cuts and Jobs Act (the "Tax Act"). The Tax Act, among other things, (i) lowered the U.S. corporate income tax rate from 35% to 21% effective January 1, 2018; (ii) provided for 100% expense deduction of certain qualified depreciable assets, which includes the Company's lease merchandise inventory, purchased after September 27, 2017 (but would be phased down starting in 2023); and (iii) the manufacturing deduction that expired in 2017 under the previous tax legislation was not extended. Consequently, the Company remeasured its net deferred tax liabilities as of December 31, 2017 using the lower U.S. corporate income tax rate, which resulted in a provisional estimated $140 million non-cash income tax benefit recognized during the year ended December 31, 2017. The Company lost its 2017 manufacturing deduction, which was limited to 9% of taxable income, as the Company was in a net operating loss position for tax purposes in 2017 as a result of the Tax Act's 100% expense deduction on qualified depreciable assets discussed above. The Company is estimating that it will again be in a net operating loss position for tax purposes in 2018 as a result of the 100% expense deduction on qualified depreciable assets. The net operating loss and credits earned during 2017 have been carried back. As of December 31, 2018, the Company is anticipating refunds of $14.5 million related to the carrybacks and $5.4 million related to overpayments on the federal returns. At December 31, 2018, the Company had $6.9 million of state tax credit carryforwards, which will begin to expire in 2022, and approximately $267 million of federal tax net operating loss carryforwards, which can be carried forward indefinitely and will not expire. In connection with the provisional analysis, the Company recorded an immaterial income tax net benefit during the year ended December 31, 2018 and finalized its analysis over the one-year measurement period that ended on December 22, 2018. As result of the 100% bonus depreciation provisions in the Tax Act not being enacted until December 22, 2017, the Company made more than the required estimated federal tax liability payments in 2017; and therefore, had a $100.0 million income tax receivable as of December 31, 2017. The Company received a refund of $77.0 million in February 2018. In addition, as a result of the extended bonus depreciation provisions in the Protecting Americans From Tax Hikes Act of 2015 not being enacted until December 2015, the Company paid more than the amount ultimately required for the 2015 federal tax liability. Due to that overpayment the Company received a refund of $120.0 million in February 2016. Following is a summary of the Company’s income tax expense (benefit):
| Year Ended December 31,
(In Thousands) | 2018 |  | 2017 |  | 2016
Current Income Tax Expense: |  |  |  |  |
Federal | $ | (5,380 | ) |  | $ | (3,530 | ) |  | $ | 103,993 |
State | 13,015 |  |  | 9,772 |  |  | 10,308 |
| 7,635 |  |  | 6,242 |  |  | 114,301 |
Deferred Income Tax Expense (Benefit): |  |  |  |  |
Federal | 48,287 |  |  | (60,547 | ) |  | (33,470 | )
State | 72 |  |  | 1,346 |  |  | (1,692 | )
| 48,359 |  |  | (59,201 | ) |  | (35,162 | )
Income Tax Expense (Benefit) | $ | 55,994 |  |  | $ | (52,959 | ) |  | $ | 79,139 |
Significant components of the Company’s deferred income tax liabilities and assets are as follows:
| December 31,
(In Thousands) | 2018 |  | 2017
Deferred Tax Liabilities: |  |  |
Lease Merchandise and Property, Plant and Equipment | $ | 174,171 |  |  | $ | 122,155 |
Goodwill and Other Intangibles | 41,183 |  |  | 37,080 |
Investment in Partnership | 159,070 |  |  | 107,173 |
Other, Net | 1,804 |  |  | 2,074 |
Total Deferred Tax Liabilities | 376,228 |  |  | 268,482 |
Deferred Tax Assets: |  |  |
Accrued Liabilities | 21,918 |  |  | 25,509 |
Advance Payments | 9,232 |  |  | 8,199 |
Other, Net | 86,339 |  |  | 23,771 |
Total Deferred Tax Assets | 117,489 |  |  | 57,479 |
Less Valuation Allowance | — |  |  | — |
Net Deferred Tax Liabilities | $ | 258,739 |  |  | $ | 211,003 |
The Company’s effective tax rate differs from the statutory United States Federal income tax rate as follows:
| Year Ended December 31,
| 2018 |  | 2017 |  | 2016
Statutory Rate | 21.0 | % |  | 35.0 | % |  | 35.0 | %
Increases (Decreases) in United States Federal Taxes |  |  |  |  |
Resulting From: |  |  |  |  |
State Income Taxes, net of Federal Income Tax Benefit | 4.0 |  |  | 2.7 |  |  | 2.6 |
Other Permanent Differences | (1.2 | ) |  | — |  |  | — |
Federal Tax Credits | (0.5 | ) |  | (0.8 | ) |  | (1.1 | )
Change in Valuation Allowance | — |  |  | (0.4 | ) |  | — |
Remeasurement of net Deferred Tax Liabilities | (0.2 | ) |  | (58.2 | ) |  | — |
Other, net | (0.9 | ) |  | (0.4 | ) |  | (0.3 | )
Effective Tax Rate | 22.2 | % |  | (22.1 | )% |  | 36.2 | %
The Company files a federal consolidated income tax return in the United States and the separate legal entities file in various states and foreign jurisdictions. With few exceptions, the Company is no longer subject to federal, state and local tax examinations by tax authorities for years before 2015. The following table summarizes the activity related to the Company’s uncertain tax positions:
| Year Ended December 31,
(In Thousands) | 2018 |  | 2017 |  | 2016
Balance at January 1, | $ | 2,269 |  |  | $ | 2,594 |  |  | $ | 3,561 |
Additions Based on Tax Positions Related to the Current Year | 269 |  |  | 456 |  |  | 258 |
Additions for Tax Positions of Prior Years | 615 |  |  | 232 |  |  | 293 |
Prior Year Reductions | (85 | ) |  | (236 | ) |  | (776 | )
Statute Expirations | (257 | ) |  | (346 | ) |  | (609 | )
Settlements | (282 | ) |  | (431 | ) |  | (133 | )
Balance at December 31, | $ | 2,529 |  |  | $ | 2,269 |  |  | $ | 2,594 |
As of December 31, 2018 and 2017, the amount of uncertain tax benefits that, if recognized, would affect the effective tax rate is $2.5 million and $1.7 million, respectively, including interest and penalties. During the year ended December 31, 2018, the Company recognized interest and penalties of $0.1 million. During the years ended December 31, 2017 and 2016, the Company recognized a net benefit of $0.6 million and $0.1 million, respectively, related to interest and penalties. The Company had $0.3 million of accrued interest and penalties at December 31, 2018 and 2017, respectively. The Company recognizes potential interest and penalties related to uncertain tax benefits as a component of income tax expense (benefit).

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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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