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Income Taxes | 12 Months Ended
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Oct. 31, 2014
Income Tax Disclosure [Abstract] |
Income Tax Disclosure [Text Block] | Income Taxes The following table provides a reconciliation of our effective tax rate from the federal statutory tax rate for the fiscal years ended October 31, 2014, 2013, and 2012 ($ amounts in thousands):
| 2014 |  | 2013 |  | 2012
| $ |  | %* |  | $ |  | %* |  | $ |  | %*
Federal tax provision at statutory rate | 176,604 |  |  | 35.0 |  |  | 93,694 |  |  | 35.0 |  |  | 39,530 |  |  | 35.0 |
State tax provision, net of federal benefit | 23,778 |  |  | 4.7 |  |  | 11,363 |  |  | 4.2 |  |  | 4,711 |  |  | 4.2 |
Domestic production activities deduction | (14,796 | ) |  | (2.9 | ) |  |  |  | — |  |  |  |  | — |
Other permanent differences | (6,214 | ) |  | (1.2 | ) |  | (4,914 | ) |  | (1.8 | ) |  |  |  | — |
Reversal of accrual for uncertain tax positions | (11,022 | ) |  | (2.2 | ) |  | (5,580 | ) |  | (2.1 | ) |  | (34,167 | ) |  | (30.3 | )
Accrued interest on anticipated tax assessments | 1,847 |  |  | 0.4 |  |  | 3,704 |  |  | 1.4 |  |  | 5,000 |  |  | 4.4 |
Increase in unrecognized tax benefits | 5,694 |  |  | 1.1 |  |  |  |  | — |  |  | 5,489 |  |  | 4.9 |
Valuation allowance — recognized | 1,328 |  |  | 0.3 |  |  | 3,232 |  |  | 1.2 |  |  |  |  | — |
Valuation allowance — reversed | (13,256 | ) |  | (2.6 | ) |  | (4,569 | ) |  | (1.7 | ) |  | (394,718 | ) |  | (349.5 | )
Other | 587 |  |  | 0.1 |  |  | 161 |  |  | 0.1 |  |  | (49 | ) |  | — |
Income tax provision (benefit)* | 164,550 |  |  | 32.6 |  |  | 97,091 |  |  | 36.3 |  |  | (374,204 | ) |  | (331.3 | )
* | Due to rounding, amounts may not add.
We currently operate in 19 states and are subject to various state tax jurisdictions. We estimate our state tax liability based upon the individual taxing authorities’ regulations, estimates of income by taxing jurisdiction, and our ability to utilize certain tax-saving strategies. Based on our estimate of the allocation of income or loss among the various taxing jurisdictions and changes in tax regulations and their impact on our tax strategies, we estimated our rate for state income taxes at 7.2%, 6.5%, and 6.5% in fiscal 2014, 2013 and 2012, respectively. The following table provides information regarding the provision (benefit) for income taxes for each of the fiscal years ended October 31, 2014, 2013, and 2012 (amounts in thousands):
| 2014 |  | 2013 |  | 2012
Federal | $ | 163,089 |  |  | $ | 93,451 |  |  | $ | (329,277 | )
State | 1,461 |  |  | 3,640 |  |  | (44,927 | )
| $ | 164,550 |  |  | $ | 97,091 |  |  | $ | (374,204 | )
Current | $ | 129,047 |  |  | $ | 23,209 |  |  | $ | (21,296 | )
Deferred | 35,503 |  |  | 73,882 |  |  | (352,908 | )
| $ | 164,550 |  |  | $ | 97,091 |  |  | $ | (374,204 | )
The following table provides a reconciliation of the change in the unrecognized tax benefits for the years ended October 31, 2014, 2013, and 2012 (amounts in thousands):
| 2014 |  | 2013 |  | 2012
Balance, beginning of year | $ | 78,105 |  |  | $ | 80,991 |  |  | $ | 104,669 |
Increase in benefit as a result of tax positions taken in prior years | 10,314 |  |  | 5,699 |  |  | 5,000 |
Increase in benefit as a result of tax positions taken in current year | 442 |  |  |  |  |  | 5,489 |
Decrease in benefit as a result of completion of audits | (1,222 | ) |  |  |  | (1,782 | )
Decrease in benefit as a result of lapse of statute of limitations | (29,321 | ) |  | (8,585 | ) |  | (32,385 | )
Balance, end of year | $ | 58,318 |  |  | $ | 78,105 |  |  | $ | 80,991 |
The statute of limitations has expired on our federal tax returns for fiscal years through 2010. Our unrecognized tax benefits are included in “Income taxes payable” on our Consolidated Balance Sheets. If these unrecognized tax benefits reverse in the future, they would have a beneficial impact on our effective tax rate at that time. During the next 12 months, it is reasonably possible that the amount of unrecognized tax benefits will change, but we are not able to provide a range of such change. The anticipated changes will be principally due to the expiration of tax statutes, settlements with taxing jurisdictions, increases due to new tax positions taken, and the accrual of estimated interest and penalties. We recognize potential interest and penalties in our tax provision (benefit). The amounts accrued for interest and penalties are included in “Income taxes payable” on our Consolidated Balance Sheets. The following table provides information as to the amounts recognized in our tax provision (benefit), before reduction for applicable taxes and reversal of previously accrued interest and penalties, of potential interest and penalties in the 12-month periods ended October 31, 2014, 2013, and 2012, and the amounts accrued for potential interest and penalties at October 31, 2014 and 2013 (amounts in thousands):
Expense recognized in Consolidated Statements of Operations and Comprehensive Income |
Fiscal year |
2014 | $ | 9,694 |
2013 | $ | 5,699 |
2012 | $ | 5,000 |
Accrued at: |
October 31, 2014 | $ | 33,867 |
October 31, 2013 | $ | 28,362 |
The components of net deferred tax assets and liabilities at October 31, 2014 and 2013 are set forth below (amounts in thousands):
| 2014 |  | 2013
Deferred tax assets: |  |  |
Accrued expenses | $ | 61,023 |  |  | $ | 53,992 |
Impairment charges | 231,098 |  |  | 262,346 |
Inventory valuation differences | 26,789 |  |  | 28,448 |
Stock-based compensation expense | 50,255 |  |  | 48,014 |
Amounts related to unrecognized tax benefits | 19,297 |  |  | 35,603 |
State tax, net operating loss carryforward | 47,330 |  |  | 55,763 |
Other | 12,030 |  |  | 20,369 |
Total assets | 447,822 |  |  | 504,535 |
Deferred tax liabilities: |  |  |
Capitalized interest | 102,951 |  |  | 100,514 |
Deferred income | 2,511 |  |  | 7,388 |
Expenses taken for tax purposes not for book | 21,076 |  |  | 29,257 |
Depreciation | 4,012 |  |  | 4,548 |
Deferred marketing | 23,073 |  |  | 21,089 |
Total liabilities | 153,623 |  |  | 162,796 |
Net deferred tax assets before valuation allowances | 294,199 |  |  | 341,739 |
Cumulative valuation allowance - state | (43,778 | ) |  | (55,707 | )
Net deferred tax assets | $ | 250,421 |  |  | $ | 286,032 |
Since the beginning of fiscal 2007, we recorded significant deferred tax assets as a result of the recognition of inventory impairments and impairments of investments in and advances to unconsolidated entities. In accordance with GAAP, we assess whether a valuation allowance should be established based on our determination of whether it is more-likely-than-not that some portion or all of the deferred tax assets would not be realized. In fiscal 2009, we recorded valuation allowances against our deferred tax assets due to our belief that the continued downturn in the housing market, the uncertainty as to its length and magnitude, our continued recognition of impairment charges, and operating losses were significant negative evidence of the need for a valuation allowance against our net deferred tax assets. At October 31, 2012, we considered the need for a valuation allowance against our deferred tax assets considering all available and objectively verifiable positive and negative evidence. That evidence principally consisted of (i) an indication that the events and conditions that gave rise to significant losses in prior years were unlikely to recur in the foreseeable future, (ii) a return to profitability in fiscal 2012 together with expectations of continuing profitability in fiscal 2013, supported by existing backlog, and beyond, and (iii) the term of the statutory operating loss carryforward periods. At October 31, 2012, we determined that the valuation allowance on our federal deferred tax assets and certain state valuation allowances were no longer needed. Accordingly, in fiscal 2012, we reversed a valuation allowance in the amount of $394.7 million; this has been reported as a component of “Income tax provision (benefit)” in the accompanying Consolidated Statements of Operations and Comprehensive Income. During fiscal 2013, we continued to re-evaluate the need for our remaining state valuation allowance and updated our fiscal 2012 analysis. Based upon our better than forecasted operating results in fiscal 2013, our significantly higher backlog at October 31, 2013, and improved forecast of results of operations in fiscal 2014, we reversed an additional $4.6 million of state deferred tax asset valuation allowance in fiscal 2013. In fiscal 2014, we continued to re-evaluate the need for our remaining state valuation allowance and updated our fiscal 2013 analysis. Based upon our operating results in fiscal 2014 and positive forecast of results of operations in fiscal 2015, we reversed an additional $13.3 million of state deferred tax asset valuation allowance in fiscal 2014. We will continue to review our deferred tax assets in accordance with ASC 740. The remaining valuation allowance at October 31, 2014 of $43.8 million relates to deferred tax assets in states that had not met the “more-likely-than-not” realization threshold criteria. We file tax returns in the various states in which we do business. Each state has its own statutes regarding the use of tax loss carryforwards. Some of the states in which we do business do not allow for the carryforward of losses, while others allow for carryforwards for 5 years to 20 years.

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