|12 Months Ended|
Dec. 31, 2012
13. Income Taxes
Income Tax Expense
Components of income tax expense were as follows (in thousands):
Effective Tax Rate Reconciliation
The reconciliation of income taxes computed at the U.S. federal statutory tax rate to our income tax expense is as follows (in thousands):
Our effective tax rate for the year 2012 differed from the federal statutory rate primarily as a result of the recapture of deductions for qualified domestic production activities under Section 199 of the IRC as a function of loss carrybacks to prior years and the impact of state income taxes. Our effective tax rate for the year 2011 differed from the federal statutory rate primarily as a result of the utilization of the deduction attributable to qualified domestic production activities under Section 199 of the IRC. Our effective tax rate for the year 2010 differed from the federal statutory rate primarily as a result of a reduction in our valuation allowance against our deferred tax assets and the Section 199 deduction described above. Taxable income in 2010 allowed us to reverse all of the previously recorded valuation allowance.
Deferred Tax Assets and Liabilities
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of our deferred tax assets and liabilities were as follows (in thousands):
During 2012, we made payments primarily for federal and state income taxes of approximately $16.1 million. We received refunds related to prior years of $0.5 million. During 2011, we made payments primarily for federal and state income taxes of approximately $35.7 million. We received refunds related to prior years of $0.4 million.
During 2010, we received refunds of federal income taxes paid in prior years totaling $99.8 million, consisting primarily of carrybacks of net operating losses generated in 2009 and 2008 and made payments of $12.0 million for federal and state income taxes.
At December 31, 2012, we had a federal income tax receivable of $47.9 million. This amount is comprised principally of a net operating loss carryback from 2012 to 2010 of $29.1 million and a net operating loss carryback from 2012 to 2011 of $13.8 million. Additionally, federal estimated tax payments were deposited in 2012 of $5.0 million.
Net Operating Loss and Tax Credit Carryovers
The table below presents the details of our net operating loss and tax credit carryovers as of December 31, 2012 (in thousands):
As of December 31, 2012 and December 31, 2011, we had a valuation allowance related to Louisiana state net operating losses. The realization of these assets depends on recognition of sufficient future taxable income in specific tax jurisdictions during periods in which those temporary differences or net operating losses are deductible. In assessing the need for a valuation allowance on our deferred tax assets, we consider whether it is more likely than not that some portion or all of them will not be realized. As part of our assessment, we consider future reversals of existing taxable temporary differences.
Uncertain Tax Positions
The table below sets forth the reconciliation of the beginning and ending balances of the total amount of unrecognized tax benefits. There are no unrecognized benefits that would impact the effective tax rate if recognized. While amounts could change in the next 12 months, we do not anticipate it having a material impact on our financial statements. We recognize interest and penalties related to uncertain tax positions in income tax expense. As of December 31, 2012, we had zero accrued interest related to uncertain tax positions. During 2011, we recognized $0.3 million of income tax benefit for the reversal of accrued interest and penalties.
Balances and changes in the uncertain tax positions are as follows (in thousands):
Years open to examination
The tax years from 2009 through 2012 remain open to examination by the tax jurisdictions to which we are subject.
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.
Reference 1: http://www.xbrl.org/2003/role/presentationRef