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Note 10 - Income Taxes | 12 Months Ended
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Dec. 31, 2011
Income Tax Disclosure [Text Block] | 10. INCOME TAXES Income tax expense (benefit) for the years ended December 31, 2011, 2010, and 2009 is comprised of:
(in thousands) |  | 2011 |  |  | 2010 |  |  | 2009 |
Federal, current |  | $ | (198 | ) |  | $ | (11,377 | ) |  | $ | 3,680 |
Federal, deferred |  |  | (1,688 | ) |  |  | 16,739 |  |  |  | (8,038 | )
State, current |  |  | 184 |  |  |  | 130 |  |  |  | (34 | )
State, deferred |  |  | (470 | ) |  |  | 683 |  |  |  | (626 | )
|  | $ | (2,172 | ) |  | $ | 6,175 |  |  | $ | (5,018 | )
Income tax expense varies from the amount computed by applying the federal corporate income tax rate of 35% to income before income taxes for the years ended December 31, 2011, 2010, and 2009 as follows:
(in thousands) |  | 2011 |  |  | 2010 |  |  | 2009 |
Computed "expected" income tax expense |  | $ | (5,754 | ) |  | $ | 3,312 |  |  | $ | (10,517 | )
State income taxes, net of federal income tax effect |  |  | (559 | ) |  |  | 322 |  |  |  | (1,050 | )
Per diem allowances |  |  | 3,015 |  |  |  | 3,350 |  |  |  | 3,320 |
Tax contingency accruals |  |  | (70 | ) |  |  | 145 |  |  |  | (216 | )
Nondeductible foreign operating income |  |  | - |  |  |  | (133 | ) |  |  | (504 | )
Nondeductible goodwill impairment |  |  | 2,275 |  |  |  | - |  |  |  | - |
Realization of outside basis difference related to Transplace |  |  | - |  |  |  | - |  |  |  | 2,599 |
Valuation allowance (release), net |  |  | (708 | ) |  |  | (638 | ) |  |  | 1,896 |
Disallowed interest release |  |  | - |  |  |  | (48 | ) |  |  | (189 | )
Tax credits |  |  | (61 | ) |  |  | (182 | ) |  |  | (44 | )
Other, net |  |  | (310 | ) |  |  | 47 |  |  |  | (313 | )
Actual income tax expense |  | $ | (2,172 | ) |  | $ | 6,175 |  |  | $ | (5,018 | )
Income tax expense varies from the amount computed by applying the federal corporate income tax rate of 35% to income (loss) before income taxes primarily due to state income taxes, net of federal income tax effect, adjusted for permanent differences, the most significant of which is the effect of the per diem pay structure for drivers. Drivers who meet the requirements to receive per diem are generally required to receive non-taxable per diem pay in lieu of a portion of their taxable wages. This per diem program increases our drivers' net pay per mile, after taxes, while decreasing gross pay, before taxes. As a result, salaries, wages, and employee benefits are slightly lower and our effective income tax rate is higher than the statutory rate. Generally, as pre-tax income increases, the impact of the driver per diem program on our effective tax rate decreases, because aggregate per diem pay becomes smaller in relation to pre-tax income, while in periods where earnings are at or near breakeven the impact of the per diem program on our effective tax rate is significant. Due to the partially nondeductible effect of per diem pay, our tax rate will fluctuate in future periods based on fluctuations in earnings. Our effective tax rate is also significantly impacted in the 2011 period by the tax deductibility of the $11.5 million goodwill impairment recorded in the third quarter of 2011, whereby $2.1 million of the goodwill impaired related to tax deductible goodwill, while the remaining $9.4 million was nondeductible and in the 2009 period by the $11.5 million loss on the sale of our investment in Transplace and the related note receivable, of which none as deductible. The temporary differences and the approximate tax effects that give rise to our net deferred tax liability at December 31, 2011 and 2010 are as follows:
(in thousands) |  | 2011 |  |  | 2010 |
Net deferred tax assets: |  |  |  |  |  |
Allowance for doubtful accounts |  | $ | 657 |  |  | $ | 539 |
Insurance and claims |  |  | 10,766 |  |  |  | 9,533 |
Net operating loss carryovers |  |  | 31,031 |  |  |  | 34,343 |
Capital loss carryover related to Transplace |  |  | 251 |  |  |  | 1,670 |
Other accrued liabilities |  |  | 1,094 |  |  |  | 445 |
Other |  |  | 4,991 |  |  |  | 6,189 |
Valuation allowance |  |  | (550 | ) |  |  | (1,258 | )
Total net deferred tax assets |  |  | 48,240 |  |  |  | 51,461 |
Net deferred tax liabilities: |  |  |  |  |  |  |  |
Property and equipment |  |  | (83,651 | ) |  |  | (87,009 | )
Other |  |  | (34 | ) |  |  | (1,990 | )
Prepaid expenses |  |  | (2,842 | ) |  |  | (3,606 | )
Total net deferred tax liabilities |  |  | (86,527 | ) |  |  | (92,605 | )
Net deferred tax liability |  | $ | (38,287 | ) |  | $ | (41,144 | )
Deferred taxes are classified in the accompanying consolidated balance sheet based on the nature of the related asset or liability as current or long-term, such that current deferred tax assets and liabilities provide a net asset of $4.4 million, while long-term deferred tax assets and liabilities provide a net liability of $42.7 million. The net deferred tax liability of $38.3 million primarily relates to differences in cumulative book versus tax depreciation of property and equipment, partially off-set by net operating loss carryovers and insurance claims that have been reserved but not paid. The carrying value of the our deferred tax assets assumes that it will be able to generate, based on certain estimates and assumptions, sufficient future taxable income in certain tax jurisdictions to utilize these deferred tax benefits. If these estimates and related assumptions change in the future, it may be required to establish a valuation allowance against the carrying value of the deferred tax assets, which would result in additional income tax expense. The carrying value of our deferred tax assets assumes that we will be able to generate, based on certain estimates and assumptions, sufficient future taxable income in certain tax jurisdictions to utilize these deferred tax benefits. If these estimates and related assumptions change in the future, we may be required to establish a valuation allowance against the carrying value of the deferred tax assets, which would result in additional income tax expense. On a periodic basis, we assess the need for adjustment of the valuation allowance. Based on forecasted taxable income resulting from the reversal of deferred tax liabilities, primarily generated by accelerated depreciation for tax purposes in prior periods, and tax planning strategies available to us, no valuation allowance has been established at December 31, 2011 or 2010, except for $0.6 million and $1.3 million, respectively, related to certain state net operating loss and capital loss carry-forwards. If these estimates and related assumptions change in the future, we may be required to modify our valuation allowance against the carrying value of the deferred tax assets. The activity in the valuation allowance on deferred tax assets (in thousands) is as follows:
Years ended December 31: |  | Beginning balance January 1, |  |  | Additional provisions to allowance |  |  | Write-offs and other deductions |  |  | Ending balance December 31, |
2011 |  | $ | 1,258 |  |  | $ | 32 |  |  | $ | (740 | ) |  | $ | 550 |
2010 |  | $ | 1,896 |  |  | $ | 42 |  |  | $ | (680 | ) |  | $ | 1,258 |
As of December 31, 2011, we had a $3.3 million liability recorded for unrecognized tax benefits, which includes interest and penalties of $1.3 million. We recognize interest and penalties accrued related to unrecognized tax benefits in tax expense. As of December 31, 2010, we had a $3.4 million liability recorded for unrecognized tax benefits, which included interest and penalties of $1.3 million. Interest and penalties recognized for uncertain tax positions were approximately $0.1 million, $0.2 million, and $0.2 million in 2011, 2010, and 2009, respectively. The following tables summarize the annual activity related to our gross unrecognized tax benefits (in thousands) for the years ended December 31, 2011, 2010, and 2009:
|  | 2011 |  |  | 2010 |  |  | 2009 |
Balance as of January 1, |  | $ | 2,133 |  |  | $ | 2,137 |  |  | $ | 1,971 |
Increases related to prior year tax positions |  |  | 3 |  |  |  | 75 |  |  |  | 67 |
Decreases related to prior year positions |  |  | - |  |  |  | (30 | ) |  |  | (3 | )
Increases related to current year tax positions |  |  | 58 |  |  |  | 110 |  |  |  | 279 |
Decreases related to settlements with taxing authorities |  |  | - |  |  |  | - |  |  |  | (122 | )
Decreases related to lapsing of statute of limitations |  |  | (215 | ) |  |  | (159 | ) |  |  | (55 | )
Balance as of December 31, |  | $ | 1,979 |  |  | $ | 2,133 |  |  | $ | 2,137 |
If recognized, $2.0 million and $2.1 million of unrecognized tax benefits would impact our effective tax rate as of December 31, 2011 and 2010 respectively. Any prospective adjustments to our reserves for income taxes will be recorded as an increase or decrease to our provision for income taxes and would impact our effective tax rate. Our 2008 through 2011 tax years remain subject to examination by the IRS for U.S. federal tax purposes, our major taxing jurisdiction. In the normal course of business, we are also subject to audits by state and local tax authorities. While it is often difficult to predict the final outcome or the timing of resolution of any particular tax matter, we believe that our reserves reflect the more likely than not outcome of known tax contingencies. We adjust these reserves, as well as the related interest, in light of changing facts and circumstances. Settlement of any particular issue would usually require the use of cash. Favorable resolution would be recognized as a reduction to our annual tax rate in the year of resolution. We do not expect any significant increases or decreases for uncertain income tax positions during the next year. Our federal net operating loss carryforwards are available to offset future federal taxable income, if any, through 2030, while our state net operating loss carryforwards and state tax credits expire over various periods through 2030 based on jurisdiction. The capital loss carryforward related to the loss on the investment in Transplace is available to offset future capital gains through 2014. We recognized a $0.4 million income tax benefit arising from the exercise of stock options and restricted share vesting in 2011 and 2010. This resulted in a related reduction in taxable income in both years and an offsetting increase to additional paid in capital.

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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 2 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32537-109319 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 136, 172 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 43, 44, 45, 46, 47, 48, 49 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph h -Article 4 Reference 5: 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 Reference 6: 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 7: 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 8: 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=6881521&loc=d3e23780-122690 + Details
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