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FORM 10-K FOR FISCAL YEAR ENDED DECEMBER 31, 1999
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
3. Provision for Income Taxes
The following is an analysis of the consolidated income tax
provision (benefit):
|
Year Ended December 31, |
|
|
|
1999 |
1998 |
1997 |
|
------------ |
------------ |
------------ |
|
|
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| Current |
$ (11,819) |
$ 214,169 |
$ 77,402 |
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| Deferred |
10,461,396 |
(25,380,546) |
10,742,015 |
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------------ |
------------ |
------------ |
| Total |
$ 10,449,577 |
$ (25,166,377) |
$ 10,819,417 |
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========= |
========= |
========= |
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There are differences between income taxes computed using the
statutory rate (35% for 1999, 1998, and 1997) and our effective income tax
rates (35.1%, 34.3%, and 32.7% for 1999, 1998, and 1997, respectively),
primarily as the result of certain tax credits available to us.
Reconciliations of income taxes computed using the statutory rate to the
effective income tax rates are as follows:
|
1999 |
1998 |
1997 |
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------------ |
------------ |
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| Income taxes computed at federal statutory rate |
$10,407,653 |
$(25,687,053) |
$11,595,362 |
| State tax provisions, net of federal benefits |
(7,801) |
23,949 |
48,058 |
| Nonconventional fuel source credit |
--- |
(287,000) |
(294,000) |
| Depletion deductions in excess of basis |
--- |
(42,500) |
(51,000) |
| Other, net |
49,725 |
826,227 |
(479,003) |
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| Provision (benefit) for income taxes |
$ 10,449,577 |
$ (25,166,377 |
$ 10,819,417 |
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========== |
The tax effects of temporary differences representing the net
deferred tax liability (asset) at December 31, 1999 and 1998, were as follows:
The tax effects of temporary differences representing the net
deferred tax liability (asset) at December 31, 1999 and 1998, were as follows:
|
1999 |
1998 |
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--------------- |
--------------- |
| Deferred tax assets: |
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|
| Alternative minimum tax credits |
$(1,979,399) |
$(1,979,399) |
| Other |
(237,587) |
(237,587) |
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--------------- |
--------------- |
| Total deferred tax
assets |
$(2,216,986) |
$(2,216,986) |
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| Deferred tax liabilities: |
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| Oil and gas properties |
$ 11,960,417 |
$ 1,531,651 |
| Other |
436,700 |
430,351 |
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| Total deferred tax
liabilities |
$ 12,397,117 |
$ 1,962,002 |
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| Net deferred tax liability (asset) |
$10,180,131 |
$ (254,984) |
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We did not record any valuation allowances against deferred tax assets at
December 31, 1999 and 1998.
At December 31, 1999, we had alternative minimum tax credits of $1,979,399
that carry forward indefinitely and are available to reduce future regular tax
liability to the extent they exceed the related tentative minimum tax
otherwise due.
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