Annual report pursuant to Section 13 and 15(d)

INCOME TAXES

v2.4.0.8
INCOME TAXES
 12 Months Ended
Dec. 31, 2013
Income Tax Disclosure [Abstract]  
INCOME TAXES
INCOME TAXES
The components of income tax expense (benefit) for the years ended December 31 were as follows (in thousands):
 
 
2013
 
2012
 
2011
Current:
 
 
 
 
 
 
Federal
 
$
3,758

 
$
(51,420
)
 
$
(18,986
)
State
 
91

 
267

 
39

Foreign
 
742

 
(60
)
 
1,042

 
 
4,591

 
(51,213
)
 
(17,905
)
Deferred:
 
 
 
 
 
 
Federal
 
5,912

 
58,566

 
19,313

State
 
1,224

 
(55
)
 
(974
)
 
 
7,136

 
58,511

 
18,339

 
 
$
11,727

 
$
7,298

 
$
434


The following table reconciles the difference between the statutory federal income tax rate for the Company and the effective income tax rate for the years ended December 31:
Provision (Benefit):
 
2013
 
2012
 
2011
Statutory rate
 
35.0
%
 
35.0
 %
 
35.0
 %
Non-deductible SEACOR management fees
 
—
%
 
—
 %
 
16.4
 %
SEACOR share award plans
 
—
%
 
(0.8
)%
 
2.2
 %
State taxes
 
1.7
%
 
0.6
 %
 
(9.6
)%
State effective tax rate changes
 
—
%
 
—
 %
 
(29.0
)%
Valuation allowance
 
2.7
%
 
—
 %
 
—
 %
Other
 
0.8
%
 
0.7
 %
 
2.6
 %
 
 
40.2
%
 
35.5
 %
 
17.6
 %

During the year ended December 31, 2011, the Company recognized an income tax benefit of $0.7 million on adjustments to deferred tax liabilities resulting from changes in state tax apportionment factors. Prior to the Spin-off, the Company participated in share award programs sponsored by SEACOR and received an additional income tax benefit or expense based on the difference between the fair market value of share awards at the time of grant and the fair market value at the time of vesting or exercise.
The components of net deferred income tax liabilities as of December 31 were as follows (in thousands):
 
 
2013
 
2012
Deferred tax liabilities:
 
 
 
 
Property and equipment
 
$
211,062

 
$
205,766

Buy-in on maintenance programs
 
3,078

 
3,929

Other
 
560

 
322

Total deferred tax liabilities
 
214,700

 
210,017

Deferred tax assets:
 
 
 
 
Equipment leases
 
638

 
971

Other
 
7,625

 
9,152

Valuation allowance
 
(790
)
 
—

Total deferred tax assets
 
7,473

 
10,123

Net deferred tax liabilities
 
$
207,227

 
$
199,894


As of December 31, 2013, the Company had state income tax net operating loss ("NOL") carryforwards of $116.2 million in various states, which will expire from 2020 to 2033 and for which a deferred tax asset of $6.9 million has been recorded.
The Company believes that it is more likely than not the benefit from some state NOL carryover will not be realized. In recognition of the risk, the Company has provided a valuation allowance of $0.8 million on the deferred tax assets relating to those NOL carry forwards. If the assumptions change and the Company determines it will be able to realize those NOLs, the tax benefits relating to any reversal of the valuation allowance on deferred tax assets would be recorded in the income tax provision in which such adjustments are identified.
As of December 31, 2013 and 2012, the Company had no unrecognized tax benefits. The Company did not incur any interest and penalties nor accrue any interest for the years ended December 31, 2013 and 2012. When applicable, the Company recognizes interest and penalties related to uncertain tax positions in interest expense and administrative and general, respectively, in the accompanying consolidated statements of operations.