Autodesk 2008 Annual Report Download - page 145

AUTODESK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
As of January 31, 2008, Autodesk had $326.0 million of cumulative Federal tax loss carryforwards and
$114.3 million of cumulative state tax loss carryforwards, which may be available to reduce future income tax
liabilities in certain jurisdictions. A portion of these Federal and state carryforwards was acquired through the
Company’s acquisitions, the utilization of which is subject to certain limitations imposed by the Internal Revenue
Code and similar state tax provisions. These Federal and state tax loss carryforwards will expire beginning fiscal
2010 through fiscal 2028 and fiscal 2012 through fiscal 2019, respectively.
As of January 31, 2008, Autodesk had $47.9 million of cumulative Federal research tax credit
carryforwards, $28.9 million of cumulative California state research tax credit carryforwards and $29.1 million
of cumulative Canadian tax credit carryforwards, which may be available to reduce future income tax liabilities
in the respective jurisdictions. The Federal credit carryforwards will expire beginning fiscal 2011 through fiscal
2029, the state credit carryforwards may reduce future California income tax liabilities indefinitely, and the
Canadian tax credit carryforwards will expire beginning fiscal 2013 through fiscal 2029. Autodesk also has $77.6
million of cumulative foreign tax credit carryforwards, which may be available to reduce future U. S. tax
liabilities. The foreign tax credit will expire beginning fiscal 2015 through fiscal 2019.
Utilization of net operating losses and tax credits may be subject to an annual limitation due to ownership
change limitations provided in the Internal Revenue Code and similar state provisions. This annual limitation
may result in the expiration of net operating losses and credits before utilization.
As a result of certain business and employment actions and capital investments undertaken by Autodesk,
income earned in certain countries is subject to reduced tax rates through fiscal 2019. The income tax benefits
attributable to the tax status of these business arrangements are estimated to be $9.0 million ($0.04 basic net
income per share) in fiscal 2008, $15.0 million ($0.06 basic net income per share) in fiscal 2007, and $31.0
million ($0.14 basic net income per share) in fiscal 2006. The amount for fiscal year 2006 includes consideration
of incremental tax benefits received from the American Jobs Creation Act of 2004 (“DRD Legislation”).
During fiscal 2008, Autodesk recognized income tax benefits of approximately $3.0 million primarily
related to the lapse of foreign statute of limitations with respect to fiscal 2001.
During fiscal 2007, Autodesk recognized the following income tax benefits:
• In December 2006, Congress passed the Tax Relief and Health Care Act of 2006 which resulted in the
reinstatement of the Federal research and development credit to the beginning of Autodesk’s fiscal
2007 year. Autodesk recorded an income tax benefit of $5.6 million from this Act during the fourth
quarter of fiscal 2007.
• Autodesk also recognized an income tax benefit of $12.5 million related to the lapse of the statute of
limitations with respect to certain Federal and foreign tax years and the release of tax reserves with
respect to fiscal 2003, offset by one-time income tax expense of $3.0 million primarily associated with
the expiration of a capital loss carryforward.
During fiscal 2006, Autodesk recognized the following income tax items:
• Autodesk repatriated approximately $512 million of foreign earnings under the DRD Legislation,
which resulted in the reclassification of $12.6 million of Federal deferred taxes to current taxes payable
relating to the repatriation of prior year foreign earnings and the accrual of $11.6 million of current
Federal taxes relating to the repatriation of current year foreign earnings.
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2008 Annua
l Report