IHOP 2009 Annual Report Download - page 148

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DineEquity, Inc. and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
20. Income Taxes (Continued)
Net deferred tax assets (liabilities) consist of the following components:
2009 2008
(In millions)
Differences in capitalization and depreciation and amortization of reacquired
franchises and equipment ......................................... $ 4.9 $ 4.9
Differences in acquisition financing costs ................................ 26.2 26.9
Employee compensation ............................................ 16.9 23.1
Other comprehensive income primarily interest rate swap loss ................ 13.2 18.8
Deferred gain on sale of assets ....................................... 1.6 1.4
Book/tax difference in revenue recognition .............................. 8.3 11.6
Michigan business tax ............................................. 9.4 9.4
Kansas High Performance Incentive Program credits ....................... 3.4 —
Other ......................................................... 27.9 28.4
Deferred tax assets ............................................... 111.8 124.5
Valuation allowance ............................................... (9.8) (7.0)
Total deferred tax assets after valuation allowance ......................... 102.0 117.5
Differences between financial and tax accounting in the recognition of franchise
and equipment sales ............................................. (68.2) (69.3)
Differences in capitalization and depreciation(1) .......................... (332.2) (382.6)
Differences in acquisition financing costs ................................ (16.5) (16.3)
Book/tax difference in revenue recognition .............................. (16.7) —
Differences between book and tax basis of property and equipment ............ (10.3) (8.9)
Other ......................................................... (11.8) (8.3)
Deferred tax liabilities ............................................. (455.7) (485.4)
Net deferred tax (liabilities) ......................................... $(353.7) $(367.9)
Net deferred tax asset (liability)—current ............................... $ 17.5 $ 29.6
Valuation allowance—current ........................................ (2.1) (2.1)
Net deferred tax asset (liability)—current ............................... 15.4 27.5
Net deferred tax asset (liability)—non current ............................ (361.4) (390.5)
Valuation allowance—non current ..................................... (7.7) (4.9)
Net deferred tax asset (liability)—non current ............................ (369.1) (395.4)
Net deferred tax (liabilities) ......................................... $(353.7) $(367.9)
(1) Primarily related to the Applebee’s acquisition.
The Company or one of its subsidiaries files Federal income tax returns and income tax returns in
various state and foreign jurisdictions. With few exceptions, the Company is no longer subject to
federal, state or non-U.S. income tax examinations by tax authorities for years before 2006 for federal
returns and before 2005 for other jurisdictions. Applebee’s is currently under audit by the U.S. Internal
Revenue Service (the ‘‘IRS’’) for the period ended November 29, 2007. The Company is currently
under audit by the IRS for the period ended December 30, 2007.
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