6.	Income Taxes

Income tax expense (benefit) consists of the following (in thousands):


	Years ended December 31,
	2011			2010			2009
Current:
Federal	$	(57	)	$	(19,190	)	$	(58,972	)
State		1,150			390			(3,327	)

Total		1,093			(18,800	)		(62,299	)

Deferred:
Federal		27,940			(5,045	)		(23,217	)
State		2,755			(948	)		(2,013	)

Total		30,695			(5,993	)		(25,230	)

Total income tax expense (benefit)	$	31,788		$	(24,793	)	$	(87,529	)

Basic paid no federal income taxes during 2011 or 2010. Basic paid federal income taxes of $243,000 during 2009.

Reconciliation between the amount determined by applying the federal statutory rate of 35% to income from continuing operations with the provision for income taxes is as follows (in thousands):


	Years ended December 31,
	2011		2010			2009
Statutory federal income tax	$	27,633	$	(23,925	)	$	(119,374	)
Meals and entertainment		630		473			374
State taxes, net of federal benefit		3,504		(847	)		(4,227	)
Impairment of non-dedcutible goodwill		—		—			35,586
Changes in estimates and other		21		(494	)		112

	$	31,788	$	(24,793	)	$	(87,529	)

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are as follows (in thousands):


	December 31,
	2011			2010
Deferred tax assets:
Receivables allowance	$	456		$	1,132
Inventory		177			42
Asset retirement obligation		492			443
Accrued liabilities		8,695			9,148
Operating loss carryforward		32,946			5,472
Goodwill and intangibles		8,298			10,399
Deferred compensation		6,732			5,770

Total deferred tax assets		57,796			32,406
Deferred tax liabilities:
Property and equipment		(199,795	)		(145,410	)
Prepaid expenses		(2,398	)		(2,099	)

Total deferred tax liabilities		(202,193	)		(147,509	)

Net deferred tax liability		(144,397	)		(115,103	)

Recognized as:
Deferred tax assets — current		39,154			8,290
Deferred tax liabilities — non-current		(183,551	)		(123,393	)

Net deferred tax liability	$	(144,397	)	$	(115,103	)

Basic provides a valuation allowance when it is more likely than not that some portion of the deferred tax assets will not be realized. There was no valuation allowance necessary as of December 31, 2011 or 2010.

Interest is recorded in interest expense and penalties are recorded in income tax expense. We had no interest or penalties related to an uncertain tax positions during 2011. Basic files federal income tax returns and state income tax returns in Texas and other state tax jurisdictions. In general, the Company's federal tax returns for fiscal years after 2005 currently remain subject to examination by appropriate taxing authorities. The Company's 2010 federal income tax return is under examination at this time.

As of December 31, 2011, Basic had approximately $83.3 million of net operating loss carryforwards ("NOL") for income tax purposes, which begin to expire in 2030.