v3.3.1.900

Income Taxes | 12 Months Ended
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Dec. 31, 2015
Income Taxes |
Income Taxes | Note 12.Income Taxes The components of income (loss) before income taxes are as follows:
|  | For the Years Ended December 31, |
|  | 2015 |  | 2014 |  | 2013 |
|  | (In thousands) |
Domestic |  | $ | 224,058 |  | $ | 172,276 |  | $ | (50,551 | )
Foreign |  | (2,486 | ) | 6,057 |  | 16,515 |
Total income (loss) before income taxes |  | $ | 221,572 |  | $ | 178,333 |  | $ | (34,036 | )
The components of the benefit (provision) for income taxes are as follows:
|  | For the Years Ended December 31, |
|  | 2015 |  | 2014 |  | 2013 |
|  | (In thousands) |
Current benefit (provision): |  |  |  |  |  |  |
Federal |  | $ | (165 | ) | $ | (2,593 | ) | $ | 1,118 |
State |  | (9,601 | ) | 9,006 |  | 6,531 |
Foreign |  | (6,303 | ) | (5,455 | ) | (5,992 | )
Total current benefit (provision) |  | (16,069 | ) | 958 |  | 1,657 |
Deferred benefit (provision): |  |  |  |  |  |  |
Federal |  | (62,572 | ) | (31,905 | ) | 26,511 |
State |  | 4,818 |  | (1,283 | ) | 10,074 |
Foreign |  | 1,622 |  | 1,446 |  | (805 | )
Total deferred (provision) benefit |  | (56,132 | ) | (31,742 | ) | 35,780 |
Total income tax (provision) benefit, net |  | $ | (72,201 | ) | $ | (30,784 | ) | $ | 37,437 |
The actual tax provisions for the years ended December 31, 2015, 2014 and 2013 reconcile to the amounts computed by applying the statutory federal tax rate to income (loss) before income taxes as shown below:
|  | For the Years Ended December 31, |
|  | 2015 |  | 2014 |  | 2013 |
Statutory rate |  | 35.0 | % | 35.0 | % | 35.0 | %
State income taxes, net of Federal benefit |  | 2.1 | % | (0.2 | )% | 21.0 | %
Permanent differences |  | 3.6 | % | 0.6 | % | (10.7 | )%
Tax credits |  | (10.1 | )% | (18.6 | )% | 48.7 | %
Valuation allowance |  | 2.8 | % | (0.9 | )% | 14.2 | %
Other |  | (0.8 | )% | 1.4 | % | 1.8 | %
Total effective tax rate |  | 32.6 | % | 17.3 | % | 110.0 | %
The components of the deferred tax assets and liabilities are as follows:
|  | As of December 31, |
|  | 2015 |  | 2014 |
|  | (In thousands) |
Deferred tax assets: |  |  |  |  |
Net operating losses, credit and other carryforwards |  | $ | 315,924 |  | $ | 412,744 |
Unrealized losses on investments, net |  | 47,678 |  | 30,248 |
Accrued expenses |  | 34,037 |  | 34,632 |
Stock-based compensation |  | 13,345 |  | 8,445 |
Other asset |  | 9,534 |  | 12,157 |
Total deferred tax assets |  | 420,518 |  | 498,226 |
Valuation allowance |  | (72,131 | ) | (73,664 | )
Deferred tax assets after valuation allowance |  | 348,387 |  | 424,562 |
Deferred tax liabilities: |  |  |  |  |
Depreciation and amortization |  | (993,326 | ) | (1,014,812 | )
Other liabilities |  | (1,412 | ) | (748 | )
Total deferred tax liabilities |  | (994,738 | ) | (1,015,560 | )
Total net deferred tax liabilities (1) |  | $ | (646,351 | ) | $ | (590,998 | )
Current portion of net deferred tax assets (1) |  | $ | — |  | $ | 87,208 |
Noncurrent portion of net deferred tax liabilities |  | (646,351 | ) | (678,206 | )
Total net deferred tax liabilities |  | $ | (646,351 | ) | $ | (590,998 | )
| (1) |  | In 2015, we early adopted ASU 2015-17 (see Note 2), which resulted in the classification of all of our deferred taxes as noncurrent as of December 31, 2015. We did not retrospectively reclassify our current deferred tax balances as of December 31, 2014.
Deferred tax assets and liabilities reflect the effects of tax losses, credits, and the future income tax effects of temporary differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases and are measured using enacted tax rates that apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. We evaluate our deferred tax assets for realization and record a valuation allowance when we determine that it is more likely than not that the amounts will not be realized. Overall, our net deferred tax assets were offset by a valuation allowance of $72.1 million and $73.7 million as of December 31, 2015 and 2014, respectively. The change in the valuation allowance primarily relates to a decrease in realized and unrealized gains that are capital in nature, partially offset by an increase in the net operating loss carryforwards of certain foreign subsidiaries. Tax benefits of net operating loss and tax credit carryforwards are evaluated on an ongoing basis, including a review of historical and projected future operating results, the eligible carryforward period, and other circumstances. As of December 31, 2015, we had net operating loss carryforwards of $768.8 million, including $92.7 million of foreign net operating loss carryforwards. A substantial portion of these net operating loss carryforwards will begin to expire in 2029. As of December 31, 2015, we have tax credit carryforwards of $96.9 million and $30.6 million for federal and state income tax purposes, respectively. If not utilized, the federal tax credit carryforwards will begin to expire in 2026 and the state tax credit carryforwards will begin to expire in 2016. Additionally, tax benefits from excess tax deductions attributable to stock-based compensation has resulted in $38.4 million of net operating loss carryforwards that will not be recognized as a credit to additional paid in capital until such deductions reduce taxes payable. We follow the tax law ordering rules, which assume that stock option deductions are realized when they have been used for tax purposes. As of December 31, 2015, we had undistributed earnings attributable to foreign subsidiaries for which no provision for U.S. income taxes or foreign withholding taxes has been made because it is expected that such earnings will be reinvested outside the U.S. indefinitely. It is not practicable to determine the amount of the unrecognized deferred tax liability at this time. Accounting for Uncertainty in Income Taxes In addition to filing U.S. federal income tax returns, we file income tax returns in all states that impose an income tax. As of December 31, 2015, we are currently under a U.S. federal income tax examination for fiscal years 2009 and 2010. We also file income tax returns in the United Kingdom, Brazil, India and a number of other foreign jurisdictions. We generally are open to income tax examination in these foreign jurisdictions for taxable years beginning in 2003. As of December 31, 2015, we are currently being audited by the Indian tax authorities for fiscal years 2003 through 2012. We have no other on-going significant income tax examinations in process in our foreign jurisdictions. A reconciliation of the beginning and ending amount of unrecognized income tax benefits is as follows:
|  | For the Years Ended December 31, |
Unrecognized tax benefit |  | 2015 |  | 2014 |  | 2013 |
|  | (In thousands) |
Balance as of beginning of period |  | $ | 44,839 |  | $ | 43,319 |  | $ | 34,677 |
Additions based on tax positions related to the current year |  | 11,748 |  | 3,806 |  | 81 |
Additions based on tax positions related to prior years |  | 5,779 |  | 4,643 |  | 9,929 |
Reductions based on tax positions related to prior years |  | — |  | (81 | ) | (1,253 | )
Reductions based on tax settlements |  | — |  | (6,848 | ) | (115 | )
Balance as of end of period |  | $ | 62,366 |  | $ | 44,839 |  | $ | 43,319 |
As of December 31, 2015, we had $62.4 million of unrecognized income tax benefits, all of which, if recognized, would affect our effective tax rate. As of December 31, 2014, we had $44.8 million of unrecognized income tax benefits, all of which if recognized, would affect our effective tax rate. We do not believe that the total amount of unrecognized income tax benefits will significantly increase or decrease within the next twelve months due to the lapse of statute of limitations or settlement with tax authorities. For the years ended December 31, 2015, 2014 and 2013, our income tax provision or benefit included an insignificant amount of interest and penalties. Estimates of our uncertain tax positions are made based upon prior experience and are updated in light of changes in facts and circumstances. However, due to the uncertain and complex application of tax regulations, it is possible that the ultimate resolution of audits may result in liabilities which could be materially different from these estimates. In such an event, we will record additional income tax provision or benefit in the period in which such resolution occurs.

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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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32559-109319 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32537-109319 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph h -Article 4 + Details
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