Income Taxes

9 Months Ended

Sep. 30, 2012

Income Taxes

Income Taxes

11. Income Taxes

Income tax expense for the three- and nine-month periods ended September 30, 2012 and 2011 is based on the estimated effective tax rate for the entire year. The estimated annual effective tax rate can be subject to adjustment in subsequent quarterly periods if components used in its estimation are revised. The estimated annual effective tax rates as of September 30, 2012 and 2011 were 31 percent and 28 percent, respectively. The increase in the estimated annual effective tax rate for 2012 reflects primarily a decrease in estimated business tax credits to be generated from operations as compared to September 30, 2011.

As of September 30, 2012, we had available for federal income tax purposes approximately $30.7 million in business tax credit carryforwards that will expire at various dates through 2032.

We are subject to federal and state taxation in the United States and various foreign jurisdictions. Currently, our 2010 tax year is subject to examination by the Internal Revenue Service and our tax years from 2008 to 2010 are subject to examination by state taxing authorities.

We are unaware of any positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly increase or decrease within the next 12 months.