Income Taxes

9 Months Ended

Sep. 30, 2012

Income Taxes

Income Taxes

(11)  Income Taxes

We are subject to income taxes in both the United States and the non-U.S. jurisdictions in which we operate. Income tax expense (benefit) for the three- and nine-month month periods ended September 30, 2012 and 2011 consisted of the following:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2012			2011			2012		2011
	(Dollars in thousands)
U.S. state current income tax expense (benefit)	$	69		$	244		$	372	$	(53	)
Federal current income tax benefit	—			(138		)	—		(1		)
Foreign current income tax expense (benefit)	(54		)	(385		)	286		1,553
Foreign deferred income tax expense (benefit)	(74		)	700			121		548
Total	$	(59	)	$	421		$	779	$	2,047

The Company recognizes deferred tax assets and liabilities in both the U.S. and foreign jurisdictions based on the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and for net operating loss and tax credit carryforwards. Deferred income tax assets and liabilities attributable to our consolidated foreign operations were not significant at September 30, 2012 and December 31, 2011. However, the Company has a substantial amount of U.S. deferred tax assets attributable primarily to net operating loss carryforwards for U.S. federal income tax purposes, and differences between the carrying amounts and the tax bases of Acquisition Partnership investments. At September 30, 2012 and December 31, 2011, the Company established a full valuation allowance for its U.S. deferred tax assets due to the lack of sufficient objective evidence regarding the realization of these assets in the foreseeable future. We will continue to evaluate the deferred tax asset valuation allowance balances in all of our U.S. and foreign subsidiaries throughout 2012 to determine the appropriate level of valuation allowances.