INCOME TAXES

9 Months Ended

Sep. 30, 2011

INCOME TAXES

INCOME TAXES

14. INCOME TAXES

        Our effective income tax rates for the three and nine months ended September 30, 2011 were 9.3% and 18.1%, respectively, as compared to 30.7% and 0.4%, as reported for the three and nine months ended September 30, 2010, respectively. The difference in the rate as compared to the U.S. statutory federal income tax rate in 2011 and 2010 was primarily due to the release of the valuation allowance that results from utilization of Canadian net operating losses and the resolution of uncertain tax positions.

Liability for Unrecognized Income Tax Benefits

        As of September 30, 2011, our liability for unrecognized income tax benefits was approximately $39.4 million. Of this amount, approximately $20.8 million relates to accrued interest and penalties. If not realized, all of this amount would affect our effective tax rate. For the three months and nine months ended September 30, 2011, we recognized approximately $0.4 million and $1.2 million, respectively of additional interest expense in our income tax provision related to our liability for unrecognized income tax benefits. Our liability for unrecognized income tax benefits decreased during the three months and nine months ended September 30, 2011, primarily as the result of the resolution of uncertain tax positions acquired with Royal Group, primarily in Canada, and foreign currency translation adjustments, offset by the accrual of additional interest expense related to our liabilities for unrecognized tax benefits.

        A reconciliation of the liability for unrecognized tax benefits for the three month and nine month periods ended September 30, 2011 is set forth in the table below:

(In thousands)		Three months ended September 30, 2011			Nine months ended September 30, 2011
Balance as of beginning of the period		$	52,975		$	53,315
	Additions for current year tax positions		14			14
	Additions for prior year tax positions		351			1,208
	Reductions for prior year tax positions		(7,877	)		(7,898	)
	Settlements		(2,952	)		(2,952	)
	Reductions related to expirations of statute of limitations		(24	)		(2,534	)
	Foreign currency translation		(3,067	)		(1,733	)
Balance as of the end of the period		$	39,420		$	39,420