Income Taxes

3 Months Ended

Mar. 31, 2012

Income Taxes [Abstract]

INCOME TAXES

6. INCOME TAXES

The Company recognized an income tax provision of $0.3 million and $0.7 million for the three months ended March 31, 2012 and 2011, respectively. The income tax provision for the three months ended March 31, 2012 and 2011 primarily relates to tax expense at foreign operations that are not in a cumulative loss position. Due to the Company’s recent cumulative domestic losses for book purposes and the uncertainty of the realization of certain deferred tax assets, the Company continues to adjust its valuation allowance as the deferred tax assets increase or decrease, resulting in effectively no recorded tax benefit for domestic operating losses. The Company’s effective tax rate was 100.0% and 15.2% for the three months ended March 31, 2012 and 2011, respectively.

The Company’s unrecognized tax benefits were $4.3 million at March 31, 2012 and December 31, 2011, of which $4.2 million are tax benefits that, if recognized, would reduce the annual effective tax rate. The Company’s continuing practice is to recognize interest and penalties related to income tax matters in income tax expense. Interest and penalties amounting to $0.2 million and $0.1 million, respectively, are included in the condensed consolidated balance sheet at March 31, 2012. The Company expects the unrecognized tax benefits to decrease by $1.6 million over the next twelve months.