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Income Taxes (Tables) | 12 Months Ended
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Dec. 31, 2012
Income Tax Expense (Benefit) | Income tax expense (benefit) consists of the following:
|  | Current |  |  | Deferred |  |  | Total |
Year ended December 31, 2012: |  |  |  |  |  |  |  |  |  |  |  |
U.S. federal |  | $ | — |  |  | $ | 7,977 |  |  | $ | 7,977 |
State and local |  |  | 823 |  |  |  | 826 |  |  |  | 1,649 |
Foreign |  |  | 1,103 |  |  |  | (1,253 | ) |  |  | (150 | )
|  | $ | 1,926 |  |  | $ | 7,550 |  |  | $ | 9,476 |
Year ended December 31, 2011: |  |  |  |  |  |  |  |  |  |  |  |
U.S. federal |  | $ | — |  |  | $ | 2,963 |  |  | $ | 2,963 |
State and local |  |  | 1,075 |  |  |  | 1,125 |  |  |  | 2,200 |
Foreign |  |  | 1,847 |  |  |  | (387 | ) |  |  | 1,460 |
|  | $ | 2,922 |  |  | $ | 3,701 |  |  | $ | 6,623 |
Year ended December 31, 2010: |  |  |  |  |  |  |  |  |  |  |  |
U.S. federal |  | $ | (1,290 | ) |  | $ | (14,174 | ) |  | $ | (15,464 | )
State and local |  |  | 477 |  |  |  | (3,767 | ) |  |  | (3,290 | )
Foreign |  |  | 1,932 |  |  |  | (6,647 | ) |  |  | (4,715 | )
|  | $ | 1,119 |  |  | $ | (24,588 | ) |  | $ | (23,469 | )
U.S. and Foreign Components of Earnings (Loss) Before Income Taxes | The U.S. and foreign components of earnings (loss) before income taxes are as follows:
|  | 2012 |  |  | 2011 |  |  | 2010 |
U.S. |  | $ | 20,444 |  |  | $ | 16,641 |  |  | $ | (59,353 | )
Foreign |  |  | (1,147 | ) |  |  | (1,468 | ) |  |  | (4,218 | )
Total |  | $ | 19,297 |  |  | $ | 15,173 |  |  | $ | (63,571 | )
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of significant differences between the reported amount of income tax expense (benefit) and the expected amount of income tax expense (benefit) that would result from applying the U.S. federal statutory income tax rate of 35 percent to income before taxes is as follows:
|  | 2012 |  |  | 2011 |  |  | 2010 |
Income tax expense (benefit) at U.S. federal statutory rate |  | $ | 6,754 |  |  | $ | 5,310 |  |  | $ | (22,250 | )
State and local income taxes, net of federal income tax benefit |  |  | 1,667 |  |  |  | 958 |  |  |  | (4,945 | )
Book expenses not deductible for tax purposes |  |  | 1,058 |  |  |  | 746 |  |  |  | 662 |
Stock-based compensation |  |  | 270 |  |  |  | 464 |  |  |  | 518 |
Amortization of non-deductible goodwill |  |  | — |  |  |  | 1 |  |  |  | 3 |
Undistributed earnings of Canadian subsidiaries (a) |  |  | — |  |  |  | (4,023 | ) |  |  | 1,083 |
Valuation allowance |  |  | (331 | ) |  |  | 382 |  |  |  | 1,487 |
Rate change (b) |  |  | 49 |  |  |  | 1,743 |  |  |  | — |
Other differences, net |  |  | 9 |  |  |  | 1,042 |  |  |  | (27 | )
Income tax expense (benefit) |  | $ | 9,476 |  |  | $ | 6,623 |  |  | $ | (23,469 | )
(a) | For the period ended December 31, 2011, management asserted that the undistributed earnings of our Canadian subsidiaries were permanently reinvested and a deferred tax benefit of $4,023 was recognized from the release of the December 31, 2010 deferred tax liability. In periods prior to December 31, 2011, the undistributed earnings of our Canadian subsidiaries were not designated as permanently reinvested.
(b) | In 2012, Ontario Bill 114 was signed into law. The enacted legislation freezes the general corporate income tax rate at 11.5%, cancelling the previously enacted rate reductions for 2012 and 2013 to 11% and 10%, respectively. As a result, a non-cash charge of $49 to income tax expense was recorded for the increase of the Canadian net deferred tax liability.
In 2011, the “Internal Revenue Code for a New Puerto Rico” was signed into law. Under the enacted legislation, the Puerto Rico corporate income tax rate was lowered from 39% to 30%. As a result, a non-cash charge of $1,743 to income tax expense was recorded for the reduction of the Puerto Rico net deferred tax asset.
Components of Deferred Taxes | The tax effect of temporary differences that give rise to significant portions of the deferred tax assets and (liabilities) are presented below:
|  | 2012 |  |  | 2011 |
Deferred tax assets: |  |  |  |  |  |  |  |
Allowance for doubtful accounts |  | $ | 2,964 |  |  | $ | 2,954 |
Accrued liabilities not deducted for tax purposes |  |  | 35,580 |  |  |  | 33,583 |
Asset retirement obligation |  |  | 65,994 |  |  |  | 61,565 |
Net operating loss carry forwards |  |  | 155,154 |  |  |  | 148,913 |
Tax credit carry forwards |  |  | 3,765 |  |  |  | 3,724 |
Charitable contributions carry forward |  |  | 592 |  |  |  | 469 |
Gross deferred tax assets |  |  | 264,049 |  |  |  | 251,208 |
Less: valuation allowance |  |  | (3,424 | ) |  |  | (3,755 | )
Net deferred tax assets |  |  | 260,625 |  |  |  | 247,453 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Property, plant and equipment |  |  | (48,271 | ) |  |  | (36,967 | )
Intangibles |  |  | (308,266 | ) |  |  | (291,926 | )
Investment in partnerships |  |  | (1,244 | ) |  |  | (1,065 | )
Gross deferred tax liabilities |  |  | (357,781 | ) |  |  | (329,958 | )
Net deferred tax liabilities |  | $ | (97,156 | ) |  | $ | (82,505 | )
Classification in the consolidated balance sheets: |  |  |  |  |  |  |  |
Current deferred tax assets |  | $ | 10,817 |  |  | $ | 9,812 |
Current deferred tax liabilities |  |  | — |  |  |  | — |
Noncurrent deferred tax assets |  |  | — |  |  |  | — |
Noncurrent deferred tax liabilities |  |  | (107,973 | ) |  |  | (92,317 | )
Net deferred tax liabilities |  | $ | (97,156 | ) |  | $ | (82,505 | )
Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
Balance as of December 31, 2010 |  | $ | 322 |
Additions for tax positions related to current year |  |  | 7 |
Additions for tax positions related to prior years |  |  | — |
Reductions for tax positions related to prior years |  |  | — |
Lapse of statute of limitations |  |  | (194 | )
Settlements |  |  | — |
Balance as of December 31, 2011 |  | $ | 135 |
Additions for tax positions related to current year |  |  | 3 |
Additions for tax positions related to prior years |  |  | — |
Reductions for tax positions related to prior years |  |  | — |
Lapse of statute of limitations |  |  | (63 | )
Settlements |  |  | — |
Balance as of December 31, 2012 |  | $ | 75 |
LAMAR MEDIA CORP [Member] |
Income Tax Expense (Benefit) | Income tax expense (benefit) consists of the following:
|  | Current |  |  | Deferred |  |  | Total |
Year ended December 31, 2012: |  |  |  |  |  |  |  |  |  |  |  |
U.S. federal |  | $ | — |  |  | $ | 8,093 |  |  | $ | 8,093 |
State and local |  |  | 824 |  |  |  | 820 |  |  |  | 1,644 |
Foreign |  |  | 1,103 |  |  |  | (1,253 | ) |  |  | (150 | )
|  | $ | 1,927 |  |  | $ | 7,660 |  |  | $ | 9,587 |
Year ended December 31, 2011: |  |  |  |  |  |  |  |  |  |  |  |
U.S. federal |  | $ | — |  |  | $ | 3,088 |  |  | $ | 3,088 |
State and local |  |  | 1,075 |  |  |  | 1,295 |  |  |  | 2,370 |
Foreign |  |  | 1,847 |  |  |  | (386 | ) |  |  | 1,461 |
|  | $ | 2,922 |  |  | $ | 3,997 |  |  | $ | 6,919 |
Year ended December 31, 2010: |  |  |  |  |  |  |  |  |  |  |  |
U.S. federal |  | $ | (1,290 | ) |  | $ | (14,130 | ) |  | $ | (15,420 | )
State and local |  |  | 529 |  |  |  | (3,607 | ) |  |  | (3,078 | )
Foreign |  |  | 1,932 |  |  |  | (6,647 | ) |  |  | (4,715 | )
|  | $ | 1,171 |  |  | $ | (24,384 | ) |  | $ | (23,213 | )
U.S. and Foreign Components of Earnings (Loss) Before Income Taxes | The U.S. and foreign components of earnings (loss) before income taxes are as follows:
|  | 2012 |  |  | 2011 |  |  | 2010 |
U.S. |  | $ | 20,780 |  |  | $ | 16,999 |  |  | $ | (59,193 | )
Foreign |  |  | (1,147 | ) |  |  | (1,468 | ) |  |  | (4,218 | )
Total |  | $ | 19,633 |  |  | $ | 15,531 |  |  | $ | (63,411 | )
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of significant differences between the reported amount of income tax expense (benefit) and the expected amount of income tax expense (benefit) that would result from applying the U.S. federal statutory income tax rate of 35 percent to income before taxes is as follows:
|  | 2012 |  |  | 2011 |  |  | 2010 |
Income tax expense (benefit) at U.S. federal statutory rate |  | $ | 6,871 |  |  | $ | 5,436 |  |  | $ | (22,193 | )
State and local income taxes, net of federal income tax benefit |  |  | 1,684 |  |  |  | 975 |  |  |  | (4,205 | )
Book expenses not deductible for tax purposes |  |  | 1,058 |  |  |  | 746 |  |  |  | 662 |
Stock-based compensation |  |  | 270 |  |  |  | 464 |  |  |  | 518 |
Amortization of non-deductible goodwill |  |  | — |  |  |  | 1 |  |  |  | 3 |
Undistributed earnings of Canadian subsidiaries (a) |  |  | — |  |  |  | (4,023 | ) |  |  | 1,083 |
Valuation allowance |  |  | (354 | ) |  |  | 382 |  |  |  | 942 |
Rate Change (b) |  |  | 49 |  |  |  | 1,743 |  |  |  | — |
Other differences, net |  |  | 9 |  |  |  | 1,195 |  |  |  | (23 | )
Income tax expense (benefit) |  | $ | 9,587 |  |  | $ | 6,919 |  |  | $ | (23,213 | )
(a) | In periods prior to December 31, 2011, the undistributed earnings of our Canadian subsidiaries were not designated as permanently reinvested. For the period ended December 31, 2011, management asserted that the undistributed earnings of our Canadian subsidiaries were permanently reinvested and a deferred tax benefit of $4,023 was recognized from the release of the December 31, 2010 deferred tax liability.
(b) | In 2012, Ontario Bill 114 was signed into law. The enacted legislation freezes the general corporate income tax rate at 11.5%, cancelling the previously enacted rate reductions for 2012 and 2013 to 11% and 10%, respectively. As a result, a non-cash charge of $49 to income tax expense was recorded for the increase of the Canadian net deferred tax liability.
In 2011, the “Internal Revenue Code for a New Puerto Rico” was signed into law. Under the enacted legislation, the Puerto Rico corporate income tax rate was lowered from 39% to 30%. As a result, a non-cash charge of $1,743 to income tax expense was recorded for the reduction of the Puerto Rico net deferred tax asset.
Components of Deferred Taxes | The tax effect of temporary differences that give rise to significant portions of the deferred tax assets and (liabilities) are presented below:
|  | 2012 |  |  | 2011 |
Deferred tax assets: |  |  |  |  |  |  |  |
Allowance for doubtful accounts |  | $ | 2,964 |  |  | $ | 2,954 |
Accrued liabilities not deducted for tax purposes |  |  | 35,580 |  |  |  | 33,583 |
Asset retirement obligation |  |  | 65,994 |  |  |  | 61,565 |
Net operating loss carry forwards |  |  | 105,918 |  |  |  | 99,811 |
Tax credit carry forwards |  |  | 18,537 |  |  |  | 18,496 |
Charitable contributions carry forward |  |  | 592 |  |  |  | 469 |
Gross deferred tax assets |  |  | 229,585 |  |  |  | 216,878 |
Less: valuation allowance |  |  | (2,851 | ) |  |  | (3,205 | )
Net deferred tax assets |  |  | 226,734 |  |  |  | 213,673 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Property, plant and equipment |  |  | (48,271 | ) |  |  | (36,967 | )
Intangibles |  |  | (307,630 | ) |  |  | (291,291 | )
Investment in partnerships |  |  | (1,244 | ) |  |  | (1,065 | )
Gross deferred tax liabilities |  |  | (357,145 | ) |  |  | (329,323 | )
Net deferred tax liabilities |  | $ | (130,411 | ) |  | $ | (115,650 | )
Classification in the consolidated balance sheets: |  |  |  |  |  |  |  |
Current deferred tax assets |  | $ | 10,817 |  |  | $ | 9,812 |
Current deferred tax liabilities |  |  | — |  |  |  | — |
Noncurrent deferred tax assets |  |  | — |  |  |  | — |
Noncurrent deferred tax liabilities |  |  | (141,228 | ) |  |  | (125,462 | )
Net deferred tax liabilities |  | $ | (130,411 | ) |  | $ | (115,650 | )
Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
Balance as of December 31, 2010 |  | $ | 322 |
Additions for tax positions related to current year |  |  | 7 |
Additions for tax positions related to prior years |  |  | — |
Reductions for tax positions related to prior years |  |  | — |
Lapse of statute of limitations |  |  | (194 | )
Settlements |  |  | — |
Balance as of December 31, 2011 |  | $ | 135 |
Additions for tax positions related to current year |  |  | 3 |
Additions for tax positions related to prior years |  |  | — |
Reductions for tax positions related to prior years |  |  | — |
Lapse of statute of limitations |  |  | (63 | )
Settlements |  |  | — |
Balance as of December 31, 2012 |  | $ | 75 |

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- Definition Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years. + References Reference 1: 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 + Details
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