Income Taxes

The provision (benefit) for income taxes is based on loss from operations before provision for income taxes and noncontrolling interests as follows ($ in thousands):



	Years Ended December 31,
	2,013			2012
United States	$	(38,705.2	)	$	(36,276.9	)
	$	(38,705.2	)	$	(36,276.9	)

The provision (benefit) for income taxes was as follows ($ in thousands):



		Years Ended December 31,
		2013		2012
Current
	US Federal	$	—	$	—
	State and local	—		—
		$	—	$	—
Deferred
	US Federal	$	476.9	$	—
	State and local	303.2		(175.5		)
		$	780.1	$	(175.5	)
Total
	US Federal	$	476.9	$	—
	State and local	303.2		(175.5		)
		$	780.1	$	(175.5	)

The provision (benefit) for income taxes is determined by applying the U.S. Federal statutory rate of 34% to income before income taxes as a result of the following ($ in thousands):



	Years Ended December 31,
	2013			2012
U.S. Federal benefit at statutory rate	(13,159.8		)	(12,334.1		)
State and local benefit net of U.S. federal tax	(3,430.9		)	(2,154.1		)
Permanent non deductible expenses for U.S. taxes	1,798.2			(2,781.4		)
True-up of prior year net operating loss	(91.4		)	321.6
Return to actual	(3,822.9		)	(384.8		)
Foreign earnings not permanently reinvested	—			(1,810.3		)
Effect of change in deferred tax rate	(1,094.8		)	525.7
Valuation allowance for deferred tax assets	20,581.7			18,441.9
Tax provision	$	780.1		$	(175.5	)

Deferred income taxes at December 31, 2013 and 2012 consist of the following ($ in thousands):



	December 31,
	2013			2012
Deferred Tax Assets:
Accumulated net operating losses (tax effected)	$	43,334.8		$	25,727.7
Deferred revenue	10.5			23.1
Contingent accounts payable	13.6			15.2
Share-based compensation	7,971.9			5,466.7
Intangibles	704.6			287.3
Accumulated depreciation	—			348.7
Charitable contributions	414.9			391.8
Bad debt provision	304.3			239.7
Capital loss carry-forward	7,036.8			6,644.5
Deferred tax assets prior to tax credit carryovers	59,791.4			39,144.7

Deferred Tax Liabilities:
Accumulated depreciation	$	(64.8	)	$	—
Intangible and indefinite lived assets	(4,379.2		)	(3,599.1		)
Deferred tax liabilities	(4,444		)	(3,599.1		)
	55,347.4			35,545.6
Valuation reserve	(59,726.6		)	(39,144.7		)
Net deferred tax liability	$	(4,379.2	)	$	(3,599.1	)

In assessing the realizability of deferred tax assets, including the net operating loss carryforwards ("NOLs"), the Company assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to utilize its existing deferred tax assets. Based on its assessment, the Company has provided a full valuation allowance against its net deferred tax assets as their future utilization remains uncertain at this time.

As of December 31, 2013 and 2012, the Company had approximately $110.6 million and $77.1 million, respectively of Federal NOLs available to offset future taxable income expiring from 2025 through 2033. In accordance with Section 382 of the Internal Revenue code, the usage of the Company’s NOLs could be limited in the event of a change in ownership. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the period when those temporary differences become deductible. If a change of ownership did occur there would be an annual limitation on the usage of the Company’s losses which are available through 2032.

As of December 31, 2013, management does not believe the Company has any material uncertain tax positions that would require it to measure and reflect the potential lack of sustainability of a position on audit in its financial statements. The Company will continue to evaluate its uncertain tax positions in future periods to determine if measurement and recognition in its financial statements is necessary. The Company does not believe there will be any material changes in its unrecognized tax positions over the next year.