Income Taxes

The components of income (loss) before income taxes are as follows:



	Year Ended December 31,
	2012			2011			2010
Domestic	$	586,631		$	404,422		$	339,382
Foreign	(1,462		)	(2,990		)	3,578
	$	585,169		$	401,432		$	342,960

The Company's provision for (benefit from) income taxes consists of the following:



	Year Ended December 31,
	2012			2011			2010
Current
Federal	$	190,917		$	120,018		$	97,822
State	15,327			8,729			8,128
Foreign	(837		)	(395		)	1,464
	205,407			128,352			107,414
Deferred
Federal	(5,398		)	6,732			7,083
State	(519		)	7,682			6,829
Foreign	124			(300		)	241
	(5,793		)	14,114			14,153
Total provision	$	199,614		$	142,466		$	121,567

A reconciliation of taxes computed at the statutory rate to the Company's income tax expense is as follows:



	Year Ended December 31,
	2012			2011			2010
Provision for federal income tax at statutory rate	$	204,809		$	140,501		$	120,036
State income tax provision net of federal income tax effect	9,625			10,745			9,372
Foreign tax	(713		)	(695		)	1,705
Foreign losses (earnings)	512			1,047			(1,252		)
Manufacturing deduction	(14,560		)	(9,905		)	(8,750		)
Contingent tax liability	—			(20		)	(411		)
Other, net	(59		)	793			867
	$	199,614		$	142,466		$	121,567

The tax effects of the principal temporary differences between financial reporting and income tax reporting at December 31 are as follows:



	2012			2011
Net operating loss carryforward	$	11,922		$	13,958
Credit carryforward	782			769
Accruals	32,486			29,002
Allowance for doubtful accounts	1,540			1,329
Inventories	7,831			7,321
Other	4,704			5,900
Deferred taxes assets—total	59,265			58,279
Property, plant and equipment	(340,237		)	(344,535		)
Turnaround costs	(10,858		)	(11,073		)
Other	(228		)	(914		)
Deferred tax liabilities—total	(351,323		)	(356,522		)
Valuation allowance	(11,927		)	(12,937		)
Total net deferred tax liabilities	$	(303,985	)	$	(311,180	)

Balance sheet classifications
Current deferred tax asset	$	22,305		$	19,611
Noncurrent deferred tax liability	(326,290		)	(330,791		)
Total net deferred tax liabilities	$	(303,985	)	$	(311,180	)

At December 31, 2012, the Company had foreign and state net operating loss carryforwards of approximately $273,341, which will expire in varying amounts between 2013 and 2031 and are subject to certain limitations on an annual basis. Management believes the Company will realize the benefit of the net operating loss carryforwards before they expire, but to the extent that the full benefit may not be realized, a net operating loss valuation allowance has been recorded. The valuation allowance decreased by $1,010 in 2012 due to the realization of capital loss and forfeiture of state loss upon the merger of subsidiaries of the Company.

Undistributed income of the Company's foreign corporate joint venture and foreign subsidiaries at December 31, 2012 amounted to $16,872, for which no U.S. deferred income tax provision has been recorded because the Company intends to permanently reinvest such income in those foreign operations. If such income was not permanently reinvested, income tax expense of approximately $6,243 would be recorded, not including potential utilization of foreign tax credits.

The gross unrecognized tax benefits at December 31 are as follows:



	2012		2011			2010
Beginning balance	$	3,122	$	3,141		$	4,873
Reductions for tax positions for prior years	—		—			(26		)
Reductions due to tax settlements	—		—			(1,389		)
Reductions due to statutes of limitations expiring	—		(19		)	(317		)
Ending balance	$	3,122	$	3,122		$	3,141

Management anticipates no material reductions to the total amount of gross unrecognized tax benefits within the next twelve months.

The Company recognizes penalties and interest accrued related to unrecognized tax benefits in income tax expense. As of December 31, 2012, the Company had no material accrued interest and penalties related to uncertain tax positions.

The Company files income tax returns in the U.S. federal jurisdiction, various states and foreign jurisdictions. The Company is no longer subject to examinations by tax authorities before the year 2006. In January 2012, the Internal Revenue Service completed the audit of the Company for the 2009 tax year with no assessment.