XML 81 R17.htm IDEA: XBRL DOCUMENT
v2.4.1.9

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2014
Income Tax Disclosure [Abstract] |
Income Taxes | 10. Income Taxes Provisions for income taxes are as follows:
|  | 2014 |  |  | 2013 |  |  | 2012 |
|  | (In Thousands) |
Current: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | (1,452 | ) |  | $ | (1,225 | ) |  | $ | 28,654 |
State |  |  | 1,013 |  |  |  | 1,357 |  |  |  | 4,695 |
Total Current |  | $ | (439 | ) |  | $ | 132 |  |  | $ | 33,349 |
Deferred: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 12,278 |  |  | $ | 32,197 |  |  | $ | 559 |
State |  |  | 561 |  |  |  | 3,092 |  |  |  | (314 | )
Total Deferred |  | $ | 12,839 |  |  | $ | 35,289 |  |  | $ | 245 |
Provisions for income taxes |  | $ | 12,400 |  |  | $ | 35,421 |  |  | $ | 33,594 |
The current provision for federal income taxes shown above includes regular federal income tax after the consideration of permanent and temporary differences between income for GAAP and tax purposes. For 2013 and in connection with the American Taxpayer Relief Act of 2012 that was signed into law in January 2013, we recorded a one-time benefit of approximately $0.5 million related to the retroactive tax relief for certain tax provisions that expired in 2012. Because the legislation was signed into law after December 31, 2012, the retroactive effects of the law reduced the current provision for 2013 and impacted the effective tax rate for 2013. The current provision for state income taxes includes regular state income tax and provisions for uncertain income tax positions. The deferred tax provision results from the recognition of changes in our prior year deferred tax assets and liabilities, and the utilization of state NOL carryforwards and other temporary differences. We reduce income tax expense for tax credits in the year they arise and are earned. At December 31, 2014, our gross amount of the investment tax credits available to offset state income taxes was minimal. These investment tax credits do not expire and carryforward indefinitely. The gross amount of federal tax credits was $2.1 million. These credits carryforward for 20 years and begin expiring in 2034. We utilized approximately $5.9 million, $0.1 million and $0.1 million of state NOL carryforwards to reduce tax liabilities in 2014, 2013 and 2012, respectively. At December 31, 2014, we have remaining federal and state tax NOL carryforwards of $33.6 million and $58.5 million, respectively, which amounts exclude the NOL carryforwards that are related to unrecognized tax benefits and stock compensation that have not been recognized in accordance with GAAP. Additionally, we had approximately $2.8 million of alternative minimum tax (“AMT”) NOL carryforwards available as a deduction against future AMT income. The federal and state NOL carryforwards begin expiring in 2033 and 2014, respectively. We considered both positive and negative evidence in our determination of the need for valuation allowances for the deferred tax assets associated with federal and state NOLs and federal credits. For 2014, 2013 and 2012, we determined it was more-likely-than-not that approximately $8.1 million, $8.3 million and $6.8 million, respectively, of the state NOL carryforwards would not be able to be utilized before expiration and a valuation allowance was maintained for the deferred tax assets associated with these state NOL carryforwards, net of federal benefit of approximately $0.3 million for each of the respective years. When non-qualified stock options (“NSOs”) are exercised, the grantor of the options is permitted to deduct the spread between the fair market value of the stock issued and the exercise price of the NSOs as compensation expense in determining taxable income. Income tax benefits related to stock-based compensation deductions in excess of the compensation expense recorded for financial reporting purposes are not recognized in earnings as a reduction of income tax expense for financial reporting purposes. As a result, the stock-based compensation deduction recognized in our income tax return will exceed the stock-based compensation expense recognized in earnings. The excess tax benefit realized (i.e., the resulting reduction in the current tax liability) related to the excess stock-based compensation tax deduction of $0.5 million in 2012 (none in 2014 and 2013), which is included in the net change in capital in excess of par value rather than a decrease in the provision for income taxes. In addition, if the grantor of NSOs will not currently reduce its tax liability from the excess tax benefit deduction taken at the time of the taxable event (option exercised) because it has a NOL carryforward that is increased by the excess tax benefit, then the tax benefit should not be recognized until the deduction actually reduces current taxes payable. The amounts included in the federal and state NOL carryforwards but not reflected in deferred tax assets at December 31, 2014 totaled $3.1 million and $1.7 million, respectively. At December 31, 2014 and 2013, we had $1.1 million and $0.5 million, respectively of unrecognized federal and state tax benefits resulting from the exercise of NSOs. Deferred tax assets and liabilities include temporary differences and carryforwards as follows:
|  | December 31, |
|  | 2014 |  |  | 2013 |
|  | (In Thousands) |
Deferred tax assets |  |  |  |  |  |  |  |
Allowance for doubtful accounts |  | $ | 823 |  |  | $ | 755 |
Asset impairment |  |  | 226 |  |  |  | 782 |
Inventory |  |  | 2,447 |  |  |  | 2,168 |
Deferred compensation |  |  | 3,914 |  |  |  | 3,977 |
Other accrued liabilities |  |  | 7,195 |  |  |  | 6,429 |
Hedging |  |  | 1,218 |  |  |  | 467 |
Net operating loss carryforwards |  |  | 13,874 |  |  |  | 12,046 |
Other |  |  | 3,700 |  |  |  | 3,823 |
Total deferred tax assets |  |  | 33,397 |  |  |  | 30,447 |
Less valuation allowance on deferred tax assets |  |  | (292 | ) |  |  | (298 | )
Net deferred tax assets |  | $ | 33,105 |  |  | $ | 30,149 |
Deferred tax liabilities |  |  |  |  |  |  |  |
Property, plant and equipment |  | $ | 92,962 |  |  | $ | 77,126 |
Prepaid and other insurance reserves |  |  | 5,452 |  |  |  | 5,182 |
Investment in unconsolidated affiliate |  |  | 64 |  |  |  | 239 |
Other |  |  | 551 |  |  |  | 687 |
Total deferred tax liabilities |  | $ | 99,029 |  |  | $ | 83,234 |
Net deferred tax liabilities |  | $ | (65,924 | ) |  | $ | (53,085 | )
Consolidated balance sheet classification: |  |  |  |  |  |  |  |
Net current deferred tax assets |  | $ | 17,204 |  |  | $ | 13,613 |
Net noncurrent deferred tax liabilities |  |  | (83,128 | ) |  |  | (66,698 | )
Net deferred tax liabilities |  | $ | (65,924 | ) |  | $ | (53,085 | )
Net deferred tax liabilities by tax jurisdiction: |  |  |  |  |  |  |  |
Federal |  | $ | (60,696 | ) |  | $ | (48,503 | )
State |  |  | (5,228 | ) |  |  | (4,582 | )
Net deferred tax liabilities |  | $ | (65,924 | ) |  | $ | (53,085 | )
All of our income before taxes relates to domestic operations. Detailed below are the differences between the amount of the provision for income taxes and the amount which would result from the application of the federal statutory rate to “Income from continuing operations before provision for income taxes”.
|  | 2014 |  |  | 2013 |  |  | 2012 |
|  | (In Thousands) |
Provisions for income taxes at federal statutory rate |  | $ | 11,263 |  |  | $ | 31,697 |  |  | $ | 32,391 |
State current and deferred income taxes |  |  | 1,497 |  |  |  | 3,916 |  |  |  | 3,533 |
Domestic production activities deduction |  |  | — |  |  |  | — |  |  |  | (1,933 | )
Effect of tax return to tax provision reconciliation |  |  | (110 | ) |  |  | (318 | ) |  |  | (216 | )
Other |  |  | (250 | ) |  |  | 126 |  |  |  | (181 | )
Provisions for income taxes |  | $ | 12,400 |  |  | $ | 35,421 |  |  | $ | 33,594 |
A reconciliation of the beginning and ending amount of uncertain tax positions is as follows:
|  | 2014 |  |  | 2013 |  |  | 2012 |
|  | (In Thousands) |
Balance at beginning of year |  | $ | 2,409 |  |  | $ | 2,292 |  |  | $ | 709 |
Additions based on tax positions related to the current year |  |  | 45 |  |  |  | 97 |  |  |  | 131 |
Additions based on tax positions of prior years |  |  | 367 |  |  |  | 255 |  |  |  | 1,937 |
Reductions for tax positions of prior years |  |  | (1,411 | ) |  |  | (123 | ) |  |  | (485 | )
Settlements |  |  | (753 | ) |  |  | (112 | ) |  |  | — |
Balance at end of year |  | $ | 657 |  |  | $ | 2,409 |  |  | $ | 2,292 |
We expect that the amount of unrecognized tax benefits may change as the result of ongoing operations, the outcomes of audits, and the expiration of statute of limitations. This change is not expected to have a significant impact on our results of operations or the financial condition. The total amount of unrecognized tax benefits that would impact the effective tax rate, if recognized, was $160,000, $204,000, and $236,000, net of federal expense, in 2014, 2013, and 2012, respectively. We record interest related to unrecognized tax positions in interest expense and penalties in operating other expense. During 2014, we recognized a recovery of $518,000 in interest expense and penalties associated with the reduction of unrecognized tax positions. During 2013 and 2012, we recognized $121,000 and $430,000, respectively, in interest and penalties associated with unrecognized tax benefits. We had approximately $67,000 and $585,000 accrued for interest and penalties at December 31, 2014 and 2013, respectively. LSB and certain of its subsidiaries file income tax returns in the U.S. federal jurisdiction and various state jurisdictions. With few exceptions, the 2011-2013 years remain open for all purposes of examination by the U.S. Internal Revenue Service (“IRS”) and other major tax jurisdictions. During 2014, we settled the examination with the IRS for the tax years 2008-2010 with no material changes to our financial position, results of operations and cash flow.

X
- Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

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