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Note 9 - Income Taxes | 9 Months Ended
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Sep. 30, 2018
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes For additional information on our income taxes, including our accounting policies and the TCJA, see Notes 1 and 10 of Notes to Consolidated Financial Statements in our 2017 Form 10-K. Because the TCJA was passed late in the fourth quarter of 2017 and ongoing guidance and accounting interpretation is expected throughout 2018, as of December 31, 2017, we made provisional estimates for the effects of the TCJA in accordance with Staff Accounting Bulletin No. 118, “Income Tax Accounting Implications of the Tax Cuts and Jobs Act” (“SAB 118,” issued by the SEC staff in December 2017). These provisional estimates primarily related to NOLs, loss reserves, share-based compensation and state taxes. We expect to complete our analysis of all deferred tax balances by December 2018. As of September 30, 2018, we have not recorded any measurement period adjustments in accordance with SAB 118 to change our provisional amounts that were recorded as of December 31, 2017. As of September 30, 2018, we have utilized substantially all of our federal NOL carryforwards. We have approximately $7.0 million of AMT credit carryforwards, which are expected to be fully utilized or refunded in the near term. If our AMT credits are not fully utilized during the 2018 tax year, then some portion of the refundable credit may be subject to sequestration under the provisions of the Balanced Budget and Emergency Deficit Reduction Act of 1985. However, we do not expect the amount potentially subject to sequestration to be material. We are required to establish a valuation allowance against our deferred tax assets when it is more likely than not that all or some portion of our deferred tax assets will not be realized. At each balance sheet date, we assess our need for a valuation allowance and our assessment is based on all available evidence, both positive and negative. This requires management to exercise judgment and make assumptions regarding whether our deferred tax assets will be realized in future periods. In making this assessment as of September 30, 2018, we determined that certain of our subsidiaries within Radian may continue to generate taxable losses on a separate company basis in the near term and may not be able to fully utilize certain of their state and local NOLs on their state and local tax returns. As of September 30, 2018, our valuation allowance is $53.1 million, which relates primarily to these separate company state and local NOLs and other state tax timing adjustments. In July 2018, we finalized a settlement with the IRS related to adjustments we had been contesting that resulted from the examination by the IRS of our 2000 through 2007 consolidated federal income tax returns. The IRS was opposing the recognition of certain tax losses and deductions that were generated through our investment in a portfolio of non-economic REMIC residual interests and proposed denying the associated tax benefits of these items. This settlement with the IRS resolved the issues and concluded all disputes related to the IRS Matter. In the three-month period ended June 30, 2018, we recorded tax benefits of $73.6 million, which includes both the impact of the settlement with the IRS as well as the reversal of certain previously accrued state and local tax liabilities. Under the terms of the settlement, we will submit to the IRS approximately $31 million of our $89 million “qualified deposits” with the U.S. Treasury and the remaining balance will be returned to us. Due to the resolution of our long-standing IRS Matter, in the second quarter of 2018 we recognized a reduction in our gross unrecognized tax benefits. This reduction, which excludes deferred uncertain tax positions as well as interest and penalties, was approximately $88.6 million, and will be reflected in our annual reconciliation of uncertain tax positions. This amount includes the reversal of certain state and local unrecognized tax benefits related to the matters contained within the IRS dispute.

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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