Income Taxes (Notes)
|12 Months Ended|
Dec. 31, 2014
|Income Tax Disclosure [Abstract]|
Income tax provision included in our reported net loss consisted of the following (in thousands):
The reconciliation of the federal statutory income tax rate to our effective income tax rate is as follows:
Significant components of our deferred tax assets and liabilities at December 31, 2014 and 2013 are as follows (in thousands):
At December 31, 2014, we had federal and state net operating loss (“NOL”) carryforwards of approximately $3.5 billion. This excludes the NOL carryforwards related to unrecognized tax benefits and stock compensation windfalls that have not been recognized under GAAP. These NOL carryforwards will expire between 2028 and 2034.
Due to our history of NOLs, current year NOLs and significant risk factors related to our ability to generate taxable income, we have established a valuation allowance to fully offset our net deferred tax assets as of December 31, 2014 and 2013. We will continue to evaluate our ability to release the valuation allowance in the future. The change in the net deferred tax asset valuation allowance was $136.1 million for the year ended December 31, 2014.
Changes in the balance of unrecognized tax benefits are as follows (in thousands):
Our effective tax rate will not be affected if the unrecognized federal income tax benefits provided above were recognized. Currently, we do not recognize any accrued liabilities, interest and penalties associated with the unrecognized tax benefits provided above in our Consolidated Statements of Operations or our Consolidated Balance Sheets. Any applicable interest and penalties related to unrecognized tax benefits would be recorded to our income tax provision.
We experienced an ownership change within the provisions of Internal Revenue Code (“IRC”) Section 382 in 2008, 2010 and 2012. An analysis of the annual limitation on the utilization of our NOLs was performed in accordance with IRC Section 382. It was determined that IRC Section 382 will not limit the use of our NOLs in full over the carryover period. We will continue to monitor trading activity in our shares which may cause an additional ownership change which could ultimately affect our ability to fully utilize our existing tax NOL carryforwards.
We are subject to taxation in the U.S., United Kingdom, Chile, Singapore and various state jurisdictions. The federal tax returns for the years before 2010 remain open to examination for the purpose of determining the amount of remaining tax NOL and other carryforwards. The federal tax returns for the years 2011 through 2014 remain open for all purposes of examination by the IRS and other taxing authorities.
Accounting for share-based compensation provides that when settlement of a share based award contributes to an NOL carryforward, neither the associated excess tax benefit nor the credit to additional paid-in capital (“APIC”) should be recorded until the share-based award deduction reduces income tax payable. Upon utilization of the loss in future periods, a benefit of $130.5 million will be reflected in APIC.
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