17.INCOME TAXES

Loss before provision for income taxes from continuing operations by geographic area is as follows:



		For the year ended December 31,
	2013		2012		2011
	(in thousands)

Domestic	$	(45,429)	$	(175,679)	$	(118,671)
Foreign		(11,789)		(1,413)		(6,108)
Total	$	(57,218)	$	(177,092)	$	(124,779)

The provision for income taxes on continuing operations consists of the following components:



		For the year ended December 31,
	2013		2012		2011
	(in thousands)
Current (benefit) provision
Federal (1)	$	—	$	(1,237)	$	—
State (1)		387		2,702		2,191
Foreign		4,946		3,769		1,608
Total current		5,333		5,234		3,799

Deferred (benefit) provision for taxes:
Federal		(11,977)		(53,501)		(38,303)
State		(3,272)		(13,750)		(5,111)
Foreign		(9,013)		(1)		(1,104)
Increase in valuation allowance		17,620		68,612		42,832
Total deferred		(6,642)		1,360		(1,686)
Total (benefit) provision for income taxes	$	(1,309)	$	6,594	$	2,113

(1)Included in the 2012 current provision for income taxes on continuing operations is a benefit of $1.5 million that is an offset to the tax expense netted in discontinued operations. Of the $1.5 million benefit, $1.2 million relates to federal taxes and $0.3 million relates to state taxes.

A reconciliation of the provision for income taxes on continuing operations at the statutory U.S. Federal tax rate (35%) and the effective income tax rate is as follows:



	For the year ended December 31,
	2013		2012		2011
			(in thousands)
Statutory Federal benefit	$	(20,027)	$	(61,982)	$	(43,673)
Foreign tax expense		2,870		1,878		1,576
State and local taxes benefit		(1,875)		(7,181)		(1,898)
Non-deductible foreign expenses		2,605		987		—
Foreign tax rate change		(4,960)		—		—
Other		2,458		4,280		3,276
Valuation allowance		17,620		68,612		42,832
(Benefit) provision for income taxes	$	(1,309)	$	6,594	$	2,113

The components of the net deferred income tax asset (liability) accounts are as follows:



	As of December 31,
	2013			2012 (3)
	(in thousands)
Current deferred tax assets:
Allowance for doubtful accounts	$	241	$	648
Deferred revenue		35,970		30,237
Accrued liabilities		14,862		4,891
Valuation allowance		(21,187)		(15,374)
Total current deferred tax assets, net (1)	$	29,886	$	20,402

Noncurrent deferred tax assets:
Net operating losses	$	438,608	$	436,083
Property, equipment, and intangible basis differences		47,602		46,357
Accrued liabilities		26,087		15,259
Non-cash compensation		8,582		7,448
Valuation allowance		(225,339)		(218,310)
Other		2,527		5,081
Total noncurrent deferred tax assets, net (2)		298,067		291,918

Noncurrent deferred tax liabilities:
Property, equipment, and intangible basis differences		(339,037)		(318,446)
Convertible debt instruments		(2,006)		(3,660)
Straight-line rents		(17,463)		(4,259)
Other		(8,079)		(6,631)
Total noncurrent deferred tax liabilities, net (2)	$	(68,518)	$	(41,078)

(1)Amounts are included in Prepaid and other current assets on the Consolidated Balance Sheets.

(2)Of these amounts, $232 and $(68,750) are included in the Other assets and Other long-term liabilities, respectively on the accompanying Consolidated Balance Sheets as of December 31, 2013. As of December 31, 2012, $148 and $(41,225) are included in the Other assets and Other long-term liabilities on the accompanying Consolidated Balance Sheet.

(3)The prior year amounts reflect a recast of the valuation allowance.

Valuation allowances of $246.5 million and $233.7 million were being carried to offset net deferred income tax assets as of December 31, 2013 and 2012, respectively. The net increase in the valuation allowance for the years ended December 31, 2013 and 2012 was $12.8 million and $57.9 million, respectively. At December 31, 2013 the valuation allowance related to federal and state tax credit carryovers was approximately $2.0 million and $0.4 million, respectively. These tax credits expire beginning 2017.

The Company has available at December 31, 2013, a net federal operating tax loss carry-forward of approximately $1.2 billion and an additional $185.5 million of net operating tax loss carry forward from stock options which will benefit additional paid-in capital when the loss is utilized. These net operating tax loss carry-forwards will expire between 2019 and 2033. The Internal Revenue Code places limitations upon the future availability of net operating losses based upon changes in the equity of the Company. If these occur, the ability of the Company to offset future income with existing net operating losses may be limited. In addition, the Company has available at December 31, 2013, a foreign net operating loss carry-forward of $36.3 million and a net state operating tax loss carry-forward of approximately $594.8 million. These net operating tax loss carry-forwards expire beginning 2014.

The Company elected a new Guatemala tax filing method effective January 1, 2014 which resulted in a reduction of deferred tax expense in the amount of $3.6 million. The Company also recorded a benefit from a Nicaragua tax rate reduction in the amount of $1.4 million.

In accordance with the Company’s methodology for determining when stock option deductions are deemed realized, the Company utilizes a “with-and-without” approach that will result in a benefit not being recorded in APIC if the amount of available net operating loss carry-forwards generated from operations is sufficient to offset the current year taxable income.

The Company does not expect to remit earnings from its foreign subsidiaries. Undistributed earnings of the Company’s foreign subsidiaries amounted to approximately $9.8 million at December 31, 2013. Those earnings are considered to be permanently reinvested and, accordingly, no U.S. Federal and state income taxes have been provided thereon. Upon distribution of those earnings in the form of dividends or otherwise, the Company could be subject to both U.S. income taxes (subject to an adjustment for foreign tax credits) and withholding taxes payable to various foreign countries.