Income Taxes

12 Months Ended

Dec. 31, 2011

Income Taxes [Abstract]

Income Taxes

9. Income Taxes

For financial reporting purposes, income before income taxes includes the following during the years ended December 31:

	2011			2010			2009
United States income (loss)	$	91,329		$	225,555		$	(525,995	)
Foreign income (loss)	$	(10,722	)	$	(25,390	)	$	(92,950	)
	$	80,607		$	200,165		$	(618,945	)

Significant components of the provision for income taxes are as follows:

	2011		2010			2009
Current:
Federal	$	—	$	(13,280	)	$	—
State		19,122		—			—
Foreign		—		9,334			8,229
Total current		19,122		(3,946	)		8,229
Deferred:
Federal		13,302		114,738			(182,605	)
State		10,629		21,534			(530	)
Foreign		463		(530	)		(21,433	)
		24,394		135,742			(204,568	)
	$	43,516	$	131,796		$	(196,339	)

The differences between the federal statutory rate and the effective tax rate as a percentage of income before taxes are as follows:

	2011			2010			2009
Statutory income tax rate		34	%		34	%		(34	%)
State and foreign income taxes, net of federal benefit		1			1			(1	)
Change in valuation allowance		—			23			—
Foreign earnings taxed at different rate		(24	)		—			—
Change in estimated state income tax rate		3			—			—
Other permanent differences		40			8			3
Effective tax rate		54	%		66	%		(32	)%

Differences between the application of accounting principles and tax laws cause differences between the bases of certain assets and liabilities for financial reporting purposes and tax purposes. The tax effects of these differences, to the extent they are temporary, are recorded as deferred tax assets and liabilities. Significant components of the Company’s deferred tax assets and liabilities at December 31 are as follows:

	2011			2010
Deferred tax liabilities:
Property, plant and equipment	$	(165,421	)	$	(48,286	)
Prepaid expenses and other		(4,599	)		(4,600	)
Total deferred tax liabilities		(170,020	)		(52,886	)
Deferred tax assets:
Operating loss carryforwards		929,061			809,214
Postretirement benefits		22,047			22,734
Pension costs		666,138			547,997
Allowance for doubtful accounts		45,667			38,023
Deferred revenues		—			117,048
Other assets		8,008			9,724
Accrued expenses		121,219			52,160
Other employee benefits		8,746			16,412
Inventory costs		74,563			66,904
Total deferred tax assets		1,875,449			1,680,216
Net		1,705,429			1,627,330
Valuation allowance		(699,874	)		(758,214	)
Net	$	1,005,555		$	869,116
Current deferred tax asset	$	278,437		$	358,481
Long-term deferred tax asset		727,118			510,635
	$	1,005,555		$	869,116

As of December 31, 2011 and 2010, the Company’s gross deferred tax assets are reduced by a valuation allowance of $699,874 and $758,214, respectively, due to negative evidence, primarily limited operating income, indicating that a valuation allowance is required. Decreases in the valuation allowance in 2011 are primarily due to increased forecast future U.S. taxable income exclusive of timing reversals. Increases in the valuation allowance from 2009 to in 2010 are primarily due to net operating losses incurred by the Company’s foreign subsidiaries during 2010.

As of December 31, 2011, the Company had U.S. net operating loss carry forwards for federal and state income tax purposes of approximately $2,150,431 and $5,977,207, respectively. These net operating losses are available to offset future federal and state income, if any, through 2029.

The Company has not provided deferred taxes for taxes that could result from the remittance of undistributed earnings of the Company’s foreign subsidiary since it has generally been the Company’s intention to reinvest these earnings indefinitely. Undistributed earnings that could be subject to additional income taxes if remitted were approximately $157,000 at December 31, 2011.

The Company files an income tax return in the U.S. federal jurisdiction, Texas, and a number of other U.S. state and local jurisdictions. Tax returns for the years 2007 through 2011 remain open for examination in various tax jurisdictions in which it operates. On January 1, 2007 the Company adopted the provisions of a new accounting pronouncement that addresses the accounting for uncertainty in income taxes recognized in the financial statements. As a result of this adoption, the Company recognized no material adjustment in the liability for unrecognized income tax benefits. At the adoption date of January 1, 2007, and at December 31, 2011, there were no unrecognized tax benefits. As of December 31, 2011, no interest related to uncertain tax positions had been accrued.