Income Taxes

12 Months Ended

Dec. 31, 2012

Income Taxes Disclosure [Abstract]

INCOME TAXES

9. INCOME TAXES:

The consolidated income tax (benefit) provision is comprised of the following:
		Year Ended December 31,
		2012		2011		2010
Current	$	12,363	$	6,464	$	4,763
(Reduction in) current tax benefit on stock based compensation		(4,427)		6,212		17,522
Total current tax		7,936		12,676		22,285
Deferred		(708,149)		244,994		236,330
Total income tax (benefit) provision	$	(700,213)	$	257,670	$	258,615

The income tax provision (benefit) for continuing operations differs from the amount that would be computed by applying the U.S. federal income tax rate of 35% to pretax income as a result of the following:

		Year Ended December 31,
		2012		2011		2010
Income tax (benefit) provision computed at the U.S. statutory rate	$	(1,006,989)	$	248,805	$	253,076
State income tax provision (benefit) net of federal benefit		(136,112)		6,329		3,608
Valuation allowance		446,148		-		(677)
Tax effect of rate change		1,358		4,228		1,939
Other, net		(4,618)		(1,692)		669
	$	(700,213)	$	257,670	$	258,615
The tax effects of temporary differences that give rise to significant components of the Company's deferred tax assets and liabilities for continuing operations are as follows:
				Year Ended December 31,
				2012		2011
Deferred tax assets - current:
Incentive compensation/other, net				6,468		9,329
Valuation allowance				(6,468)		-
Net deferred tax assets - current			$	-	$	9,329
Deferred tax liabilities - current:
Derivative instruments, net			$	-	$	82,709
Net deferred tax liabilities - current			$	-	$	82,709
Net deferred tax liability - current			$	-	$	73,380
Deferred tax assets - non-current:
Property and equipment				350,978		-
Deferred gain				55,329		-
U.S. Federal tax credit carryforwards				4,870		13,280
Capital loss carryforwards				-		1,929
Net operating loss carryforwards				17,755		150
Incentive compensation/other, net				15,104		12,880
				444,036		28,239
Valuation allowance				(443,300)		(3,621)
Net deferred tax assets - non-current			$	736	$	24,618
Deferred tax liabilities - non-current:
Property and equipment				-		659,040
Other				736		587
Net non-current tax liabilities			$	736	$	659,627
Net non-current tax liability			$	-	$	635,009

In assessing the realizability of the deferred tax assets, management considers whether it is more likely than not that some or all of the deferred tax assets will not be realized. The ultimate realization of the deferred tax assets is dependent upon the generation of future taxable income during the periods in which the temporary differences become deductible. Among other items, management considers the scheduled reversal of deferred tax liabilities, historical taxable income, projected future taxable income, and available tax planning strategies.

As a result of the ceiling test and other impairments recorded during the year ended December 31, 2012, the Company's previously recorded net deferred tax liability fully reversed into a net deferred tax asset. The Company has recorded a full valuation allowance against its net deferred tax asset balance of $449.8 million as of December 31, 2012. This valuation allowance may be reversed in future periods against future taxable income.

As of December 31, 2012, the Company had approximately $3.2 million of U.S. federal alternative minimum tax (AMT) credits available to offset regular U.S. Federal income taxes. These AMT credits do not expire and can be carried forward indefinitely. In addition, the Company has $1.7 million of foreign tax credit carryforwards, none of which expire prior to 2017. The Company has U.S. State tax net operating loss carryforwards of $273.1 million which will expire between 2031 and 2032.

The Company did not have any unrecognized tax benefits and there was no effect on our financial condition or results of operations as a result of implementing the standard related to accounting for uncertain tax positions. The amount of unrecognized tax benefits did not change as of December 31, 2012.

Estimated interest and penalties related to potential underpayment on any unrecognized tax benefits are classified as a component of tax expense in the Consolidated Statements of Operations. The Company has not recorded any interest or penalties associated with unrecognized tax benefits.

The Company files a consolidated federal income tax return in the United States federal jurisdiction and various combined, consolidated, unitary, and separate filings in several states, and international jurisdictions. The income tax years 2009 and 2010 have been audited by the Internal Revenue Service resulting in no material changes to the Company's taxes. With certain exceptions, including previous audited tax years, the income tax years 2009 through 2012 remain open to examination by the major taxing jurisdictions in which the Company has business activity.

The undistributed earnings of the Company's U.S. subsidiaries are considered to be indefinitely invested outside of Canada. Accordingly, no provision for Canadian income taxes and/or withholding taxes has been provided thereon.