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Income Taxes | 12 Months Ended
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Dec. 31, 2014
Income Tax Disclosure [Abstract] |
Income Taxes | 7. Income Taxes The components of the provision for income taxes are as follows:
|  | Years Ended December 31, |
|  | 2014 |  |  | 2013 |  |  | 2012 |
($ in thousands) |  |  |  |  |  |  |  |  |
Current |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 31,787 |  |  | $ | 10,395 |  |  | $ | — |
State |  |  | 3,168 |  |  |  | 1,787 |  |  |  | 341 |
Total current tax expense |  |  | 34,955 |  |  |  | 12,182 |  |  |  | 341 |
Deferred |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | 3,200 |  |  |  | 29,933 |  |  |  | 19,707 |
State |  |  | 1,194 |  |  |  | 2,663 |  |  |  | 6,982 |
Total deferred tax expense (benefit) |  |  | 4,394 |  |  |  | 32,596 |  |  |  | 26,689 |
Total expense for income taxes |  | $ | 39,349 |  |  | $ | 44,778 |  |  | $ | 27,030 |
The following presents a reconciliation of the provision (benefit) for income taxes computed at the federal statutory rate to the provision (benefit) for income taxes recognized in the Consolidated Statements of Operations for the years indicated:
|  | Years Ended December 31, |
|  | 2014 |  |  | 2013 |  |  | 2012 |
($ in thousands) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Tax at statutory rate |  | $ | 47,922 |  |  |  | 35 | % |  | $ | 41,968 |  |  |  | 35 | % |  | $ | 22,645 |  |  |  | 35 | %
State taxes, net of federal benefit |  |  | 4,357 |  |  |  | 3 |  |  |  | 2,893 |  |  |  | 2 |  |  |  | 4,793 |  |  |  | 7 |
Uncertain tax positions |  |  | (30,961 | ) |  |  | (22 | ) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
IRS audit resolution |  |  | 15,505 |  |  |  | 11 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Change in valuation allowance |  |  | 2,165 |  |  |  | 2 |  |  |  | (264 | ) |  |  | — |  |  |  | (242 | ) |  |  | — |
Other, net |  |  | 361 |  |  |  | — |  |  |  | 181 |  |  |  | — |  |  |  | (166 | ) |  |  | — |
Income tax expense |  | $ | 39,349 |  |  |  | 29 | % |  | $ | 44,778 |  |  |  | 37 | % |  | $ | 27,030 |  |  |  | 42 | %
The provision for income taxes reflects U.S. federal, state and local taxes at an estimated effective tax rate of 28.9%, 36.7% and 41.7% for the years ended December 31, 2014, 2013 and 2012, respectively. The Company’s effective tax rate for the year ended December 31, 2014 was impacted by a net tax benefit of approximately $15.5 million due to the settlement of the Internal Revenue Service (“IRS”) examination of its 2011 federal consolidated corporate income tax return. The net benefit is comprised of the recognition of tax benefits from uncertain tax positions of approximately $31.0 million and a reduction in the deferred tax assets of approximately $15.5 million which are related to a loss resulting from the past dissolution of a subsidiary. Deferred taxes resulted from temporary differences between the amounts reported in the consolidated financial statements and the tax basis of assets and liabilities. The tax effects of temporary differences are as follows:
|  | December 31, |
|  | 2014 |  |  | 2013 |
($ in thousands) |  |  |  |  |  |
Deferred tax assets: |  |  |  |  |  |  |  |
Intangible assets |  | $ | 36,340 |  |  | $ | 43,827 |
Net operating losses |  |  | 21,547 |  |  |  | 23,705 |
Compensation accruals |  |  | 6,757 |  |  |  | 6,280 |
Investments |  |  | 8,717 |  |  |  | 5,111 |
Unrealized loss/(gain) |  |  | 2,362 |  |  |  | (2,357 | )
Other |  |  | 46 |  |  |  | 1,581 |
Gross deferred tax assets |  |  | 75,769 |  |  |  | 78,147 |
Valuation allowance |  |  | (2,397 | ) |  |  | (35 | )
Gross deferred tax assets after valuation allowance |  |  | 73,372 |  |  |  | 78,112 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Intangible assets |  |  | (12,718 | ) |  |  | (13,078 | )
Other investments |  |  | (492 | ) |  |  | (534 | )
Gross deferred tax liabilities |  |  | (13,210 | ) |  |  | (13,612 | )
Deferred tax assets, net |  | $ | 60,162 |  |  | $ | 64,500 |
At each reporting date, the Company evaluates the positive and negative evidence used to determine the likelihood of realization of all its deferred tax assets. The Company maintained a valuation allowance in the amount of $2.4 million, $0.0 million and $1.6 million at December 31, 2014, 2013 and 2012, respectively, relating to deferred tax assets on items of a capital nature as well as certain state deferred tax assets. As of December 31, 2014, the Company had $41.0 million of net operating loss carry-forwards for federal income tax purposes. The related federal net operating loss carry-forwards are scheduled to begin to expire in the year 2029. As of December 31, 2014, the Company had state net operating loss carry-forwards, varying by subsidiary and jurisdiction, represented by a $7.2 million deferred tax asset. The state net operating loss carry-forwards are scheduled to begin to expire in 2016. Internal Revenue Code Section 382 limits tax deductions for net operating losses, capital losses and net unrealized built-in losses after there is a substantial change in ownership in a corporation’s stock involving a 50 percentage point increase in ownership by 5% or larger stockholders. During the year ended December 31, 2009, due to changes in the Company’s stockholder base, the Company incurred an ownership change as defined in Section 382. At December 31, 2014, the Company has approximately $66.5 million in pre-change net operating loss carryovers and built-in losses that are reflected within the Company’s deferred tax assets noted above and are subject to an annual limitation of $4.2 million plus any cumulative unused Section 382 limitation from post-change tax years. Activity in unrecognized tax benefits is as follows:
|  | Years Ended December 31, |
|  | 2014 |  |  | 2013. |  |  | 2012 |
($ in thousands) |  |  |  |  |  |  |  |  |
Balance, beginning of year |  | $ | 32,602 |  |  | $ | 33,948 |  |  | $ | 34,139 |
Decrease related to tax positions taken in prior years |  |  | (32,602 | ) |  |  | (1,346 | ) |  |  | (191 | )
Increase related to positions taken in the current year |  |  | — |  |  |  | — |  |  |  | — |
Balance, end of year |  | $ | — |  |  | $ | 32,602 |  |  | $ | 33,948 |
In connection with completion of the IRS examination of the Company’s 2011 consolidated corporate income tax return, the Company reduced its unrecognized tax benefits by $32.6 million ($31.0 million, net of federal benefit during the year ended December 31, 2014). The completion of the examination also resulted in an adjustment that decreased the Company’s net operating loss carry-forwards by approximately $15.5 million. The Company’s practice is to classify interest and penalties related to income tax matters in income tax expense. The Company recorded no interest or penalties related to uncertain tax positions at December 31, 2014, 2013 and 2012. During the year ended December 31, 2014, the Company recognized tax benefits of $24.8 million related to cumulative windfall deductions on certain stock-based incentive plans. Under ASC 718, Compensation-Stock Compensation, these tax benefits are utilized for financial statement purposes when they serve to reduce income taxes payable. Under the Company’s accounting policy, net operating losses and benefits from other sources are recognized before windfall benefit carryovers. The tax benefit related to these windfall deductions was recorded as an increase to Stockholders’ Equity. The earliest federal tax year that remains open for examination is 2008 since unutilized net operating loss carry-forwards from 2008 could be denied when claimed in future years. The earliest open years in the Company’s major state tax jurisdictions are 2001 and 2000 for Connecticut and New York, respectively.

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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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