Chipotle 2012 Annual Report Download - page 51
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3. Income Taxes
The components of the provision for income taxes are as follows:
Years ended December 31
2012 2011 2010
Current tax:
U.S. Federal ........................................ $ 166,386 $ 100,983 $ 83,850
U.S. State .......................................... 31,231 21,848 15,745
Foreign ............................................ 125 (6) 6
197,742 122,825 99,601
Deferred tax:
U.S. Federal ........................................ (16,024) 12,080 10,058
U.S. State .......................................... (2,013) (50) 6
Foreign ............................................ (1,578) (711) —
(19,615) 11,319 10,064
Valuation allowance ..................................... 1,558 616 415
Provision for income taxes ................................ $ 179,685 $ 134,760 $ 110,080
Actual taxes paid for each tax period were less than the current tax expense due to the excess tax benefit on
stock-based compensation of $73,210, $38,786, and $14,526 during the years ended December 31 2012, 2011,
and 2010, respectively.
The effective tax rate differs from the statutory tax rates as follows:
Years ended December 31
2012 2011 2010
Statutory U.S. federal income tax rate .......................... 35.0% 35.0% 35.0%
State income tax, net of related federal income tax benefit .......... 4.1 4.1 3.5
Federal credits ............................................ — (0.8) (0.4)
Other .................................................... 0.2 0.2 —
Effective income tax rates ................................... 39.3% 38.5% 38.1%
In January 2013, the United States Congress authorized, and the President signed into law, certain federal
tax credits that can be reflected in the Company’s U.S. tax return for 2012; however, since this law was enacted
in 2013, the financial statement benefit of such credits cannot be reflected until the first quarter of 2013. The lack
of availability of such credits caused the 2012 effective tax rate to be approximately 0.5% higher than it would
have been had the credits been approved in 2012.
Deferred U.S. income taxes have not been recorded for temporary differences related to investments in
certain foreign subsidiaries. These temporary differences consisted primarily of undistributed earnings
considered permanently invested in operations outside the U.S. Determination of the deferred income tax liability
on these unremitted earnings is not practicable because such liability, if any, is dependent on circumstances
existing if and when remittance occurs.
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Annual Report