XML 75 R18.htm IDEA: XBRL DOCUMENT
v2.4.1.9

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2014
Income Taxes | (11) Income Taxes The Company has filed, for prior taxable years through its taxable year ended December 31, 2014, a consolidated U.S. federal tax return, which includes all of its wholly owned domestic subsidiaries. For its taxable year commencing January 1, 2014, the Company intends to file as a REIT, and its TRSs intend to file as C corporations. The Company also files tax returns in various states and countries. The Company’s state tax returns reflect different combinations of the Company’s subsidiaries and are dependent on the connection each subsidiary has with a particular state. The following information pertains to the Company’s income taxes on a consolidated basis. Income tax expense (benefit) consists of the following:
|  | Current |  |  | Deferred |  |  | Total |
Year ended December 31, 2014: |  |  |  |  |  |  |  |  |  |  |  |
U.S. federal |  | $ | 8,721 |  |  | $ | (119,014 | ) |  | $ | (110,293 | )
State and local |  |  | 2,632 |  |  |  | (2,909 | ) |  |  | (277 | )
Foreign |  |  | 692 |  |  |  | (214 | ) |  |  | 478 |
|  | $ | 12,045 |  |  | $ | (122,137 | ) |  | $ | (110,092 | )
Year ended December 31, 2013: |  |  |  |  |  |  |  |  |  |  |  |
U.S. federal |  | $ | 930 |  |  | $ | 21,681 |  |  | $ | 22,611 |
State and local |  |  | 1,609 |  |  |  | 1,165 |  |  |  | 2,774 |
Foreign |  |  | 1,553 |  |  |  | (4,097 | ) |  |  | (2,544 | )
|  | $ | 4,092 |  |  | $ | 18,749 |  |  | $ | 22,841 |
Year ended December 31, 2012: |  |  |  |  |  |  |  |  |  |  |  |
U.S. federal |  | $ | — |  |  | $ | 6,743 |  |  | $ | 6,743 |
State and local |  |  | 823 |  |  |  | 826 |  |  |  | 1,649 |
Foreign |  |  | 1,103 |  |  |  | (1,253 | ) |  |  | (150 | )
|  | $ | 1,926 |  |  | $ | 6,316 |  |  | $ | 8,242 |
The income tax provision for the year ended December 31, 2014 is net of the deferred tax benefit due to the REIT conversion of $120,081. As of December 31, 2014 and 2013, the Company had income taxes payable of $308 and $848, respectively, included in accrued expenses. The U.S. and foreign components of earnings before income taxes are as follows:
|  | 2014 |  |  | 2013 |  |  | 2012 |
U.S. |  | $ | 144,298 |  |  | $ | 62,506 |  |  | $ | 17,279 |
Foreign |  |  | (872 | ) |  |  | 474 |  |  |  | (1,147 | )
Total |  | $ | 143,426 |  |  | $ | 62,980 |  |  | $ | 16,132 |
A reconciliation of significant differences between the reported amount of income tax expense and the expected amount of income tax expense that would result from applying the U.S. federal statutory income tax rate of 35 percent to income before taxes is as follows:
|  | 2014 |  |  | 2013 |  |  | 2012 |
Income tax expense at U.S. federal statutory rate |  | $ | 50,199 |  |  | $ | 22,043 |  |  | $ | 5,646 |
Tax adjustment related to REIT (a) |  |  | (44,891 | ) |  |  | — |  |  |  | — |
State and local income taxes, net of federal income tax benefit |  |  | 1,017 |  |  |  | 3,585 |  |  |  | 1,541 |
Book expenses not deductible for tax purposes |  |  | 2,061 |  |  |  | 1,351 |  |  |  | 1,058 |
Stock-based compensation |  |  | (33 | ) |  |  | 65 |  |  |  | 270 |
Valuation allowance |  |  | — |  |  |  | (1,097 | ) |  |  | (331 | )
Rate change (b) |  |  | 91 |  |  |  | (2,565 | ) |  |  | 49 |
Deferred tax adjustment due to REIT conversion |  |  | (120,081 | ) |  |  | — |  |  |  | — |
Other differences, net |  |  | 1,545 |  |  |  | (541 | ) |  |  | 9 |
Income tax expense |  | $ | (110,092 | ) |  | $ | 22,841 |  |  | $ | 8,242 |
(a) | Includes dividend paid deduction of $62,937.
(b) | In 2013, the “Tax Burden Adjustment and Redistribution Act” was signed into law. Under the enacted legislation, the Puerto Rico corporate income tax rate was increased to 39% from 30%. As a result, a non-cash benefit of $2,479 to income tax expense was recorded for the increase of the Puerto Rico net deferred tax asset. Also in 2013, British Columbia Bill 2 was signed into law. The enacted legislation increased the general corporate income tax rate to 11% from 10%. As a result, a non-cash benefit of $86 to income tax expense was recorded for the increase of the Canadian net deferred tax asset.
The tax effect of temporary differences that give rise to significant portions of the deferred tax assets and (liabilities) are presented below:
|  | 2014 |  |  | 2013 |
Deferred tax assets: |  |  |  |  |  |  |  |
Allowance for doubtful accounts |  | $ | 255 |  |  | $ | 2,972 |
Accrued liabilities not deducted for tax purposes |  |  | 4,703 |  |  |  | 37,764 |
Asset retirement obligation |  |  | 79 |  |  |  | 70,166 |
Net operating loss carry forwards |  |  | 11,881 |  |  |  | 138,865 |
Tax credit carry forwards |  |  | 209 |  |  |  | 4,844 |
Charitable contributions carry forward |  |  | 9 |  |  |  | 9 |
Property, plant and equipment |  |  | 65 |  |  |  | — |
Investment in partnerships |  |  | 354 |  |  |  | — |
Gross deferred tax assets |  |  | 17,555 |  |  |  | 254,620 |
Less: valuation allowance |  |  | (9 | ) |  |  | (2,331 | )
Net deferred tax assets |  |  | 17,546 |  |  |  | 252,289 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Property, plant and equipment |  |  | — |  |  |  | (45,160 | )
Intangibles |  |  | (4,321 | ) |  |  | (314,382 | )
Investment in partnerships |  |  | — |  |  |  | (1,519 | )
Gross deferred tax liabilities |  |  | (4,321 | ) |  |  | (361,061 | )
Net deferred tax assets (liabilities) |  | $ | 13,225 |  |  | $ | (108,772 | )
Classification in the consolidated balance sheets: |  |  |  |  |  |  |  |
Current deferred tax assets |  | $ | 729 |  |  | $ | 10,378 |
Current deferred tax liabilities |  |  | — |  |  |  | — |
Noncurrent deferred tax assets |  |  | 12,496 |  |  |  | — |
Noncurrent deferred tax liabilities |  |  | — |  |  |  | (119,150 | )
Net deferred tax assets (liabilities) |  | $ | 13,225 |  |  | $ | (108,772 | )
As of December 31, 2014, we have approximately $257,839 of U.S. net operating loss carry forwards to offset future taxable income. Of this amount, $6,063 is subject to an IRC §382 limitation. These carry forwards expire between 2020 through 2032. In addition, we have $4,822 of various credits available to offset future U.S. federal income tax. As of December 31, 2014 we have approximately $449,691 of state net operating loss carry forwards before valuation allowances. These state net operating losses are available to reduce future taxable income and expire at various times and amounts. In addition, we have $241 of various credits available to offset future state income tax. The valuation allowance related to state net operating loss carry forwards as of December 31, 2014 and 2013 was $0 and $2,323, respectively. The net change in the total valuation allowance for each of the years ended December 31, 2014, 2013, and 2012 was a decrease of $2,322, $1,087 and $332, respectively. The decrease in 2014 was primarily due to the adjustment of deferred tax assets and related valuation allowance for assets and liabilities of REIT operations no longer subject to state income taxes at the REIT level, which had the effect of valuing these assets at an expected rate of 0%. During 2014, we generated $1,454 of Puerto Rico net operating losses. As of December 31, 2014, we had approximately $28,354 of Puerto Rico net operating losses available to offset future taxable income. These carry forwards expire between 2016 and 2024. In addition, we have $209 of alternative minimum tax credits available to offset future Puerto Rico income tax. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in those jurisdictions during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities (including the impact of available carry back and carry forward periods), projected future taxable income, and tax-planning strategies in making this assessment. In order to fully realize the deferred tax assets, the Company will need to generate future taxable income before the expiration of the carry forwards governed by the tax code. Based on the current level of pretax earnings, the Company will generate the minimum amount of future taxable income to support the realization of the deferred tax assets. Additionally, the Company has deferred tax liabilities that will reverse during the same period and jurisdiction and are of the same character as the temporary differences giving rise to the deferred tax assets. As a result, management believes that it is more likely than not that we will realize the benefits of these deferred tax assets, net of the existing valuation allowances at December 31, 2014. The amount of the deferred tax asset considered realizable, however, could be reduced in the near term if estimates of future taxable income during the carry forward period are reduced. We have not recognized a deferred tax liability of approximately $8,326 for the undistributed earnings of our Canadian operations that arose in 2014 and prior years as management considers these earnings to be indefinitely invested outside the U.S. As of December 31, 2014, the undistributed earnings of these subsidiaries were approximately $23,789. Under ASC 740, we provide for uncertain tax positions, and the related interest, and adjust recognized tax benefits and accrued interest accordingly. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
Balance as of December 31, 2012 |  | $ | 75 |
Additions for tax positions related to current year |  |  | 1 |
Additions for tax positions related to prior years |  |  | — |
Reductions for tax positions related to prior years |  |  | — |
Lapse of statute of limitations |  |  | (41 | )
Settlements |  |  | — |
Balance as of December 31, 2013 |  | $ | 35 |
Additions for tax positions related to current year |  |  | — |
Additions for tax positions related to prior years |  |  | — |
Reductions for tax positions related to prior years |  |  | — |
Lapse of statute of limitations |  |  | (35 | )
Settlements |  |  | — |
Balance as of December 31, 2014 |  | $ | — |
As of December 31, 2014, we do not have any unrecognized tax benefits that, if recognized in future periods, would impact our effective tax rate. We are subject to income taxes in the U.S. and nearly all states. In addition, the Company is subject to income taxes in Canada and the Commonwealth of Puerto Rico. We are no longer subject to U.S federal income tax examinations by tax authorities for years before 2010 since the IRS has completed review of our income tax returns through 2009, or for any U.S. state income tax audit prior to 2002. With respect to Canada and Puerto Rico, we are no longer subject to income tax audits for years before 2009 and 2008, respectively.
LAMAR MEDIA CORP [Member] |
Income Taxes | (6) Income Taxes Income tax expense (benefit) consists of the following:
|  | Current |  |  | Deferred |  |  | Total |
Year ended December 31, 2014: |  |  |  |  |  |  |  |  |  |  |  |
U.S. federal |  |  | 8,993 |  |  |  | (151,191 | ) |  |  | (142,198 | )
State and local |  |  | 2,579 |  |  |  | (4,124 | ) |  |  | (1,545 | )
Foreign |  |  | 692 |  |  |  | (213 | ) |  |  | 479 |
|  | $ | 12,264 |  |  | $ | (155,528 | ) |  | $ | (143,264 | )
Year ended December 31, 2013: |  |  |  |  |  |  |  |  |  |  |  |
U.S. federal |  | $ | 930 |  |  | $ | 21,798 |  |  | $ | 22,728 |
State and local |  |  | 1,609 |  |  |  | 1,184 |  |  |  | 2,793 |
Foreign |  |  | 1,553 |  |  |  | (4,097 | ) |  |  | (2,544 | )
|  | $ | 4,092 |  |  | $ | 18,885 |  |  | $ | 22,977 |
Year ended December 31, 2012: |  |  |  |  |  |  |  |  |  |  |  |
U.S. federal |  | $ | — |  |  | $ | 6,859 |  |  | $ | 6,859 |
State and local |  |  | 824 |  |  |  | 820 |  |  |  | 1,644 |
Foreign |  |  | 1,103 |  |  |  | (1,253 | ) |  |  | (150 | )
|  | $ | 1,927 |  |  | $ | 6,426 |  |  | $ | 8,353 |
The income tax provision for the year ended December 31, 2014 is net of the deferred tax benefit due to REIT conversion of approximately $153.472. As of December 31, 2014 and December 31, 2013, the Company had income taxes payable of $308 and $630, respectively, included in accrued expenses. The U.S. and foreign components of earnings before income taxes are as follows:
|  | 2014 |  |  | 2013 |  |  | 2012 |
U.S. |  | $ | 144,643 |  |  | $ | 62,841 |  |  | $ | 17,615 |
Foreign |  |  | (872 | ) |  |  | 474 |  |  |  | (1,147 | )
Total |  | $ | 143,771 |  |  | $ | 63,315 |  |  | $ | 16,468 |
A reconciliation of significant differences between the reported amount of income tax expense and the expected amount of income tax expense that would result from applying the U.S. federal statutory income tax rate of 35 percent to income before taxes is as follows:
|  | 2014 |  |  | 2013 |  |  | 2012 |
Income tax expense at U.S. federal statutory rate |  | $ | 50,320 |  |  | $ | 22,160 |  |  | $ | 5,764 |
Tax adjustment related to REIT (a) |  |  | (45,012 | ) |  |  | — |  |  |  | — |
State and local income taxes, net of federal income tax benefit |  |  | 1,017 |  |  |  | 3,601 |  |  |  | 1,557 |
Book expenses not deductible for tax purposes |  |  | 2,061 |  |  |  | 1,351 |  |  |  | 1,058 |
Stock-based compensation |  |  | (33 | ) |  |  | 65 |  |  |  | 270 |
Valuation allowance |  |  | — |  |  |  | (1,094 | ) |  |  | (354 | )
Rate Change (b) |  |  | 91 |  |  |  | (2,565 | ) |  |  | 49 |
Deferred tax adjustment due to REIT conversion |  |  | (153,472 | ) |  |  | — |  |  |  | — |
Other differences, net |  |  | 1,764 |  |  |  | (541 | ) |  |  | 9 |
Income tax expense |  | $ | (143,264 | ) |  | $ | 22,977 |  |  | $ | 8,353 |
(a) | Includes dividend paid deduction of $63,058.
(b) | In 2013, the “Tax Burden Adjustment and Redistribution Act” was signed into law. Under the enacted legislation, the Puerto Rico corporate income tax rate was increased to 39% from 30%. As a result, a non-cash benefit of $2,479 to income tax expense was recorded for the increase of the Puerto Rico net deferred tax asset. Also in 2013, British Columbia Bill 2 was signed into law. The enacted legislation increased the general corporate income tax rate to 11% from 10%. As a result, a non-cash benefit of $86 to income tax expense was recorded for the increase of the Canadian net deferred tax asset.
The tax effect of temporary differences that give rise to significant portions of the deferred tax assets and (liabilities) are presented below:
|  | 2014 |  |  | 2013 |
Deferred tax assets: |  |  |  |  |  |  |  |
Allowance for doubtful accounts |  | $ | 255 |  |  | $ | 2,972 |
Accrued liabilities not deducted for tax purposes |  |  | 4,703 |  |  |  | 37,764 |
Asset retirement obligation |  |  | 79 |  |  |  | 70,166 |
Net operating loss carry forwards |  |  | 11,881 |  |  |  | 89,496 |
Tax credit carry forwards |  |  | 209 |  |  |  | 19,615 |
Charitable contributions carry forward |  |  | 9 |  |  |  | 9 |
Property, plant and equipment |  |  | 65 |  |  |  | — |
Investment in partnership |  |  | 354 |  |  |  | — |
Gross deferred tax assets |  |  | 17,555 |  |  |  | 220,022 |
Less: valuation allowance |  |  | (9 | ) |  |  | (1,760 | )
Net deferred tax assets |  |  | 17,546 |  |  |  | 218,262 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Property, plant and equipment |  |  | — |  |  |  | (45,160 | )
Intangibles |  |  | (4,321 | ) |  |  | (313,746 | )
Investment in partnerships |  |  | — |  |  |  | (1,519 | )
Gross deferred tax liabilities |  |  | (4,321 | ) |  |  | (360,425 | )
Net deferred tax assets (liabilities) |  | $ | 13,225 |  |  | $ | (142,163 | )
Classification in the consolidated balance sheets: |  |  |  |  |  |  |  |
Current deferred tax assets |  | $ | 729 |  |  | $ | 10,378 |
Current deferred tax liabilities |  |  | — |  |  |  | — |
Noncurrent deferred tax assets |  |  | 12,496 |  |  |  | — |
Noncurrent deferred tax liabilities |  |  | — |  |  |  | (152,541 | )
Net deferred tax liabilities |  | $ | 13,225 |  |  | $ | (142,163 | )
As of December 31, 2014, we have approximately $122,078 of U.S. net operating loss carry forwards to offset future taxable income. Of this amount, $6,063 is subject to an IRC §382 limitation. These carry forwards expire between 2020 and 2032. In addition, we have $19,593 of various credits available to offset future U.S. federal income tax. As of December 31, 2014, we have approximately $411,970 state net operating loss carry forwards before valuation allowances. These state net operating losses are available to reduce future taxable income and expire at various times and amounts. In addition, we have $241 of various credits available to offset future state income tax. The valuation allowance for these deferred tax assets as of December 31, 2014 and December 31, 2013 was $0 and $1,751, respectively. The net change in the total valuation allowance for each of the years ended December 31, 2014, 2013, and 2012 was a decrease of $1,751, $1,085 and $356, respectively. The decrease in 2014 was primarily due to the adjustment of deferred tax assets and related to valuation allowance for assets and liabilities of REIT operations no longer subject to state income taxes at the REIT level, which had the effect of valuing these assets at an expected rate of 0%. During 2014, we generated $1,454 of Puerto Rico net operating losses. As of December 31, 2014, we had approximately $28,354 of Puerto Rico net operating losses available to offset future taxable income. These carry forwards expire between 2016 and 2024. In addition, we have $209 of alternative minimum tax credits available to offset future Puerto Rico income tax. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in those jurisdictions during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities (including the impact of available carry back and carry forward periods), projected future taxable income, and tax-planning strategies in making this assessment. In order to fully realize the deferred tax assets, the Company will need to generate future taxable income before the expiration of the carry forwards governed by the tax code. Based on the current level of pretax earnings for financial reporting purposes, we will generate the minimum amount of future taxable income to support the realization of the deferred tax assets. Additionally, the Company has deferred tax liabilities that will reverse during the same period and jurisdiction and is of the same character as the temporary differences giving rise to the deferred tax assets. As a result, management believes that it is more likely than not that we will realize the benefits of these deferred tax assets, net of the existing valuation allowances at December 31, 2014. The amount of the deferred tax asset considered realizable, however, could be reduced in the near term if estimates of future taxable income during the carry forward period are reduced. We have not recognized a deferred tax liability of approximately $8,326 for the undistributed earnings of our Canadian operations that arose in 2014 and prior years as management considers these earnings to be indefinitely invested outside the U.S. As of December 31, 2014, the undistributed earnings of these subsidiaries were approximately $23,789. Under ASC 740, we provide for uncertain tax positions, and the related interest, and adjust recognized tax benefits and accrued interest accordingly. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
Balance as of December 31, 2012 |  | $ | 75 |
Additions for tax positions related to current year |  |  | 1 |
Additions for tax positions related to prior years |  |  | — |
Reductions for tax positions related to prior years |  |  | — |
Lapse of statute of limitations |  |  | (41 | )
Settlements |  |  | — |
Balance as of December 31, 2013 |  | $ | 35 |
Additions for tax positions related to current year |  |  | — |
Additions for tax positions related to prior years |  |  | — |
Reductions for tax positions related to prior years |  |  | — |
Lapse of statute of limitations |  |  | (35 | )
Settlements |  |  | — |
Balance as of December 31, 2014 |  | $ | — |
As of December 31, 2014, we do not have any unrecognized tax benefits that, if recognized in future periods, would impact our effective tax rate. We are subject to income taxes in the U.S. and nearly all states. In addition, the Company is subject to income taxes in Canada and the Commonwealth of Puerto Rico. We are no longer subject to U.S federal income tax examinations by tax authorities for years before 2010 since the IRS has completed review of our income tax returns through 2009, or for any U.S. state income tax audit prior to 2002. With respect to Canada and Puerto Rico, we are no longer subject to income tax audits for years before 2009 and 2008, respectively.

X
- 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
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Details
Name: | dei_LegalEntityAxis=us-gaap_SubsidiariesMember
Namespace Prefix: |
Data Type: | na
Balance Type: |
Period Type: |