7. Income Taxes

Income tax expense is summarized as follows:

	Year Ended December 31,

(In thousands)	2012		2011			2010
Current
Federal	$	24,618	$	39,749		$	29,879
State		563		(1,714	)		3,424

Total		25,181		38,035			33,303

Deferred
Federal		57,704		46,599			37,981
State		23,225		28,145			23,828

Total		80,929		74,744			61,809

Total income tax expense	$	106,110	$	112,779		$	95,112

Total income taxes were different than the amounts computed by applying the statutory federal income tax rate as follows:

	Year Ended December 31,

(Dollars in thousands)	2012			2011		2010
Statutory federal income tax rate		35%			35%		35%
Computed "expected" federal income tax	$	83,244		$	82,316	$	69,475
State income tax, net of federal income tax benefit		9,609			8,989		6,638
Deferred tax adjustment related to change in overall state tax rate		13,596			19,068		18,973
Other, net		(339	)		2,406		26

Total income tax expense	$	106,110		$	112,779	$	95,112

The tax effects of temporary differences that resulted in significant portions of the deferred tax liabilities and deferred tax assets were as follows:

	December 31,

(In thousands)	2012		2011
Deferred Tax Liabilities
Property, plant and equipment	$	1,204,735	$	1,068,762
Hedging liabilities / receivables		19,915		68,670
Prepaid expenses and other		736		9,261

Total		1,225,386		1,146,693

Deferred Tax Assets
Alternative minimum tax credit		125,862		101,290
Net operating loss		137,422		113,496
Foreign tax credits		4,923		4,685
Pension and other post-retirement benefits		16,498		19,892
Items accrued for financial reporting purposes and other		52,806		49,606

Total		337,511		288,969

Net deferred tax liabilities	$	887,875	$	857,724

As of December 31, 2012, the Company had alternative minimum tax credit carryforwards of $125.9 million which do not expire and can be used to offset regular income taxes in future years to the extent that regular income taxes exceed the alternative minimum tax in any such year. The Company also had net operating loss carryforwards of $398.6 million and $378.2 million for federal and state reporting purposes, respectively, the majority of which will expire between 2016 and 2032. The Company believes it is more likely than not that these deferred tax benefits will be utilized prior to their expiration. Tax benefits related to employee stock-based compensation included in net operating loss carryforwards but not reflected in deferred tax assets as of December 31, 2012 are approximately $66.9 million.

Uncertain Tax Positions

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

	Year Ended December 31,

(In thousands)	2012		2011		2010
Unrecognized tax benefit balance at beginning of year	$	—	$	—	$	500
Additions based on tax provisions related to the current year		—		—		—
Additions for tax positions of prior years		—		—		—
Reductions for tax positions of prior years		—		—		(500	)
Settlements		—		—		—

Unrecognized tax benefit balance at end of year	$	—	$	—	$	—

During 2010, unrecognized tax benefits were reduced by $0.5 million as a result of the completion of the Internal Revenue Service (IRS) Joint Committee on Taxation review of the 2005-2008 tax years that were under audit by the IRS. This reduction did not materially affect the effective tax rate. As of December 31, 2012 and 2011, the Company did not have any uncertain tax positions reported in the Consolidated Balance Sheet.

The Company files income tax returns in the U.S. federal jurisdiction, various states and other jurisdictions. The Company is no longer subject to examinations by state authorities before 2008. The Company is not currently under examination by the IRS.