XML 100 R20.htm IDEA: XBRL DOCUMENT

Note 11 - Federal and State Income Taxes

12 Months Ended

Dec. 31, 2014

11.

FEDERAL AND STATE INCOME TAXES

Under GAAP, deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and for income tax reporting purposes.

Significant components of the Company’s deferred tax liabilities and assets at December 31 are as follows:

	2014				2013
	(in thousands)
	Current		Long-Term		Current		Long-Term

Deferred tax liabilities:
Property and equipment	$	-	$	64,341	$	-	$	73,099
Unrealized gains on securities		3,918		-		3,769		-
Prepaid expenses and other		3,837		-		2,498		-

Total deferred tax liabilities		7,755		64,341		6,267		73,099

Deferred tax assets:
Allowance for doubtful accounts		612		-		561		-
Alternative minimum tax credit carryforward		-		1,206		-		318
QAFMV tax credit carryforward		-		864		-		864
New hire tax credit		-		124		-		124
Compensated absences		564		-		594		-
Self-insurance allowances		2,592		-		1,027		-
Share-based compensation		-		579		-		702
Goodwill		-		28		-		37
Marketable equity securities		686		-		767		-
Net operating loss carryover		-		4,392		-		21,255
Capital loss carryover		339		-		667		-
Non-competition agreement		-		23		-		30
Other		11		-		-		5

Total deferred tax assets		4,804		7,216		3,616		23,335

Net deferred tax liability	$	2,951	$	57,125	$	2,651	$	49,764

The reconciliation between the effective income tax rate and the statutory Federal income tax rate for the years ended December 31, 2014, 2013 and 2012 is presented in the following table:

	2014				2013				2012
	(in thousands)
	Amount		Percent		Amount		Percent		Amount		Percent

Income tax at the statutory federal rate	$	7,552		34.0	$	3,288		34.0	$	1,222		34.0
Nondeductible expenses		154		0.7		127		1.3		138		3.8
State income taxes/other—net of federal benefit		1,015		4.6		341		3.6		56		1.6

Total income tax expense	$	8,721		39.3	$	3,756		38.9	$	1,416		39.4

The provision for income taxes consisted of the following:

	2014		2013		2012
	(in thousands)
Current:
Federal	$	814	$	124	$	-
State		395		35		51
		1,209		159		51
Deferred:
Federal		6,111		2,909		1,166
State		1,401		688		199
		7,512		3,597		1,365

Total income tax expense	$	8,721	$	3,756	$	1,416

The Company has alternative minimum tax credits of approximately $1,206,000 at December 31, 2014, which have no expiration date under the current federal income tax laws and general business credits of approximately $988,000 which begin to expire after the year 2030. The Company also has net operating loss carryovers for federal income purposes of approximately $11,571,000 which begin to expire after the year 2030.

In determining whether a tax asset valuation allowance is necessary, management, in accordance with the provisions of ASC 740-10-30, weighs all available evidence, both positive and negative to determine whether, based on the weight of that evidence, a valuation allowance is necessary. If negative conditions exist which indicate a valuation allowance might be necessary, consideration is then given to what effect the future reversals of existing taxable temporary differences and the availability of tax strategies might have on future taxable income to determine the amount, if any, of the required valuation allowance. As of December 31, 2014 and 2013, management determined that the future reversals of existing taxable temporary differences and available tax strategies would generate sufficient future taxable income to realize its tax assets and therefore a valuation allowance was not necessary.

The Company recognizes a tax benefit from an uncertain tax position only if it is more likely than not that the position will be sustained on examination by taxing authorities, based on the technical merits of the position. As of December 31, 2014, an adjustment to the Company’s consolidated financial statements for uncertain tax positions has not been required as management believes that the Company’s tax positions taken in income tax returns filed or to be filed are supported by clear and unambiguous income tax laws. The Company recognizes interest and penalties related to uncertain income tax positions, if any, in income tax expense. During 2014 and 2013, the Company has not recognized or accrued any interest or penalties related to uncertain income tax positions.

The Company and its subsidiaries are subject to U.S. and Canadian federal income tax laws as well as the income tax laws of multiple state jurisdictions. The major tax jurisdictions in which the Company operates generally provide for a deficiency assessment statute of limitation period of three years and as a result, the Company’s tax years 2011 and forward remain open to examination in those jurisdictions.

The Company contracts with a third-party qualified intermediary in order to maintain a like-kind exchange tax program. Under the program, dispositions of eligible trucks or trailers and acquisitions of replacement trucks or trailers are made in a form whereby any associated tax gains related to the disposal are deferred. To qualify for like-kind exchange treatment, we exchange, through our qualified intermediary, eligible trucks or trailers being disposed with trucks or trailers being acquired that allows us to generally carryover the tax basis of the trucks or trailers sold. The program is expected to result in a significant deferral of federal and state income taxes. Under the program, the proceeds from the sale of eligible trucks or trailers carry a Company-imposed restriction for the acquisition of replacement trucks or trailers. These proceeds may be disqualified under the program at any time and at the Company’s sole discretion; however, income tax deferral would not be available for any sale for which the Company disqualifies the related proceeds. At December 31, 2014, the Company had $8,496,000 of restricted cash held by the third-party qualified intermediary. At December 31, 2013, the Company had $623,000 of restricted cash held by the third-party qualified intermediary. Restricted cash is accounted for in “Accounts receivable-other”.

- 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+ Details