(7) Income Taxes
The components of our income tax provision (benefit) are as follows (in millions):
|
| | | | | | | | | | | |
| Year Ended December 31, |
| 2017 | | 2016 | | 2015 |
Current income tax provision | $ | 2.6 |
| | $ | 1.9 |
| | $ | 3.1 |
|
Deferred tax benefit | (26.6 | ) | | (0.6 | ) | | (3.6 | ) |
Total income tax provision (benefit) | $ | (24.0 | ) | | $ | 1.3 |
| | $ | (0.5 | ) |
Net income for financial statement purposes may differ significantly from taxable income of unitholders because of differences between the tax basis and financial reporting basis of assets and liabilities and the taxable income allocation requirements under our partnership agreement. The aggregate difference in the basis of our net assets for financial and tax reporting purposes cannot be readily determined because information regarding each partner’s tax attributes is not available to us.
On December 22, 2017, the Tax Cuts and Jobs Act was signed into legislation and resulted in a change in the federal statutory corporate tax rate from 35% to 21%, effective January 1, 2018. Accordingly, we have reduced deferred tax liabilities and recorded a deferred tax benefit in the amount of $24.9 million due to a remeasurement of deferred tax liabilities primarily related to our wholly-owned corporate entities.
Deferred tax liabilities of $46.3 million and $73.0 million existed at December 31, 2017 and 2016, respectively. Deferred tax liabilities as of December 31, 2017 and 2016 included $38.8 million and $63.1 million related to our wholly-owned corporate entity that was formed to acquire the common stock of Clearfield Energy, Inc. This deferred tax liability represents the future tax payable on the difference between the fair value and the carryover tax basis of the assets acquired and is expected to become payable no later than 2027.
As of December 31, 2017 and 2016, there was no recorded unrecognized tax benefit. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in millions):
|
| | | | | | | | | | | |
| Year Ended December 31, |
| 2017 | | 2016 | | 2015 |
Beginning Balance, January 1 | $ | — |
| | $ | 1.5 |
| | $ | 2.0 |
|
Decrease due to prior year tax positions | — |
| | (1.5 | ) | | (0.5 | ) |
Ending Balance, December 31 | $ | — |
| | $ | — |
| | $ | 1.5 |
|
Per our accounting policy election, penalties and interest related to unrecognized tax benefits are recorded to income tax expense. As of December 31, 2017, tax years 2013 through 2017 remain subject to examination by various taxing authorities.