Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

Components of Net Income Before Income Taxes

Income Tax Provision/(Benefit). The components of net income from continuing operations before income taxes are as follows (in thousands):

	2014			2013			2012
Domestic	$	70,737		$	63,278		$	103,917
Foreign		(9,215	)		(1,759	)		(26,693	)
Total	$	61,522		$	61,519		$	77,224

Schedule of Components of Income Tax Expense (Benefit)

The income tax provision related to continuing operations consists of the following (in thousands):

	2014			2013			2012
Current:
Federal	$	19,221		$	7,260		$	32,121
State		2,348			453			4,133
Foreign		2,953			4,273			2,658
		24,522			11,986			38,912
Deferred:
Federal		1,139			1,130			(832	)
State		837			2,329			(3,977	)
Foreign		(1,935	)		(5,277	)		(5,758	)
		41			(1,818	)		(10,567	)
Total income tax provision	$	24,563		$	10,168		$	28,345

Schedule of Effective Income Tax Rate Reconciliation

The difference between our income tax provision computed at the statutory Federal income tax rate and our financial statement income tax related to continuing operations is summarized as follows (in thousands):

	2014			2013			2012
Provision at Federal rate of 35%	$	21,533		$	21,532		$	27,028
State income taxes, net of Federal impact		2,070			1,808			101
Research and experimentation credits		(2,045	)		(16,683	)		(3,651	)
Tax uncertainties		596			4,878			1,333
Section 199 manufacturing deduction		(1,936	)		(2,263	)		(4,246	)
Foreign rate differential		2,847			1,133			3,108
Valuation allowance for deferred tax assets		3,602			(3,312	)		3,550
Other impact of foreign operations		(3,555	)		2,088			672
Other		1,451			987			450
Total income tax provision	$	24,563		$	10,168		$	28,345

Net Deferred Income Tax Liabilities

Deferred Income Taxes. Net deferred income tax liabilities as of December 31, 2014 and 2013 are as follows (in thousands):

	2014			2013
Deferred income tax assets	$	77,201		$	68,829
Deferred income tax liabilities		(55,045	)		(48,830	)
Valuation allowance		(20,507	)		(17,741	)
Net deferred income tax assets	$	1,649		$	2,258

The Components of Net Deferred Income Tax Assets (Liabilities)

The components of our net deferred income tax assets (liabilities) as of December 31, 2014 and 2013 are as follows (in thousands):

	2014			2013
Net current deferred income tax assets:
Accrued expenses and reserves	$	10,221		$	12,429
Stock-based compensation		4,425			3,929
Total current deferred income tax assets		14,646			16,358
Less: valuation allowance		(1,442	)		(1,273	)
Net current deferred income tax assets	$	13,204		$	15,085
Net non-current deferred income tax assets:
Software	$	809		$	-
Client contracts and related intangibles		(5,252	)	$	(952	)
NOL carryforwards		18,527			11,505
Property and equipment		11,470			4,097
Deferred revenue		550			1,209
Facility abandonment		262			189
Other		305			678
Total non-current deferred income tax assets		26,671			16,726
Less: valuation allowance		(17,781	)		(9,279	)
Net non-current deferred income tax assets	$	8,890		$	7,447
Net non-current deferred income tax liabilities:
Software	$	211		$	88
Client contracts and related intangibles		3,127			(4,104	)
Goodwill		(6,747	)		(3,846	)
NOL carryforwards		23,298			27,500
Property and equipment		(15,048	)		(4,812	)
Convertible debt securities		(27,708	)		(35,116	)
Deferred revenue		961			4,470
Contingent payments		840			836
Facility abandonment		2,194			1,892
Other		(289	)		7
Total non-current deferred income tax liabilities		(19,161	)		(13,085	)
Less: valuation allowance		(1,284	)		(7,189	)
Net non-current deferred income tax liabilities	$	(20,445	)	$	(20,274	)

Reconciliation of Beginning and Ending Balances of Liability for Unrecognized Tax Benefits

A reconciliation of the beginning and ending balances of our liability for unrecognized tax benefits is as follows (in thousands):

	2014			2013			2012
Balance, beginning of year	$	9,517		$	4,029		$	4,114
Additions based on tax positions related to current year		760			1,292			276
Additions for tax positions of prior years		30			4,597			933
Reductions for tax positions of prior years		(677	)		(401	)		(764	)
Lapse of statute of limitations		-			-			(530	)
Balance, end of year	$	9,630		$	9,517		$	4,029