EMC 2008 Annual Report Download - page 86
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Table of Contents
EMC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
K. Income Taxes
Our provision (benefit) for income taxes consists of (table in thousands):
2008 2007 2006
Federal:
Current $ 156,501 $ 324,812 $ 335,193
Deferred 39,263 (53,312) (115,835)
195,764 271,500 219,358
State:
Current 18,387 21,475 3,982
Deferred 3,664 (1,556) (2,176)
22,051 19,919 1,806
Foreign:
Current 100,879 100,556 (44,545)
Deferred (6,180) (13,529) (13,955)
94,699 87,027 (58,500)
Total provision for income taxes $ 312,514 $ 378,446 $ 162,664
In 2008, 2007 and 2006, we were able to utilize $52.6 million, $62.3 million and $31.1 million, respectively, of net operating loss carryforwards and tax
credits to reduce the current portion of our tax provision.
The effective income tax rate is based upon the income for the year, the composition of the income in different countries, and adjustments, if any, for the
potential tax consequences, benefits or resolutions of tax audits. A reconciliation of our income tax provision to the statutory federal tax rate is as follows:
2008 2007 2006
Statutory federal tax rate 35.0% 35.0% 35.0%
State taxes, net of federal taxes 1.2 1.2 0.4
Resolution of income tax audits and expiration of statutes of limitation (2.7) (1.2) (12.4)
Tax rate differential for international jurisdictions and other international related tax items (15.0) (14.5) (13.9)
U.S. tax credits (4.9) (2.0) (1.3)
Changes in valuation allowance — (1.5) 0.5
Permanent items 4.6 1.7 3.5
Other 0.2 (0.3) (0.1)
18.4% 18.4% 11.7%
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