Cincinnati Bell 2013 Annual Report Download - page 187

Form 10-K Part II Cincinnati Bell Inc.
13. Income Taxes
Income tax expense consists of the following:
Year Ended December 31,
(dollars in millions) 2013 2012 2011
Current:
Federal ................................................................. $ — $ 1.8 $ —
State and local ........................................................... — 1.6 0.4
Total current ............................................................ — 3.4 0.4
Investment tax credits ..................................................... (0.2) (0.3) (0.3)
Deferred:
Federal ................................................................. (13.0) 21.8 24.3
State and local ........................................................... (3.7) 2.0 3.4
Foreign ................................................................ 0.3 (0.5) 0.1
Total deferred ........................................................... (16.4) 23.3 27.8
Valuation allowance ...................................................... 14.1 (1.7) (2.9)
Total .................................................................. $ (2.5) $24.7 $25.0
The following is a reconciliation of the statutory federal income tax rate with the effective tax rate for each
year:
Year Ended December 31,
2013 2012 2011
U.S. federal statutory rate .................................................... 35.0% 35.0% 35.0%
State and local income taxes, net of federal income tax ............................ 1.5 3.9 2.9
Change in valuation allowance, net of federal income tax .......................... (15.8) (2.3) (4.4)
State net operating loss adjustments ............................................ 2.7 3.7 2.7
Nondeductible interest expense ............................................... (11.4) 18.1 15.0
Unrecognized tax benefit changes ............................................. (2.1) 2.2 2.8
Nondeductible compensation ................................................. (2.5) 2.7 2.1
Foreign .................................................................. (0.7) 3.5 0.1
Other differences, net ....................................................... (2.3) 2.0 1.1
Effective tax rate .......................................................... 4.4% 68.8% 57.3%
The income tax (benefit) provision was charged to continuing operations, accumulated other comprehensive
income (loss) or additional paid-in capital as follows:
Year Ended December 31,
(dollars in millions) 2013 2012 2011
Income tax (benefit) provision related to:
Continuing operations ..................................................... $(2.5) $24.7 $ 25.0
Accumulated other comprehensive income (loss) ............................... 42.1 (0.4) (26.5)
Excess tax benefits on stock option exercises .................................. (0.5) (2.4) —
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Form 10-K