Sallie Mae 2008 Annual Report Download - page 208

19. Income Taxes (Continued)
At December 31, 2008 and 2007, the tax effect of temporary differences that give rise to deferred tax
assets and liabilities include the following:
2008 2007
December 31,
Deferred tax assets:
Loan reserves .......................................... $1,212,653 $ 867,840
Market value adjustments on student loans, investments and
derivatives ........................................... 174,276 322,001
Purchased paper impairments ............................... 111,924 6,272
Deferred revenue ........................................ 70,172 61,780
Stock-based compensation plans ............................. 62,325 54,137
Unrealized investment losses ............................... 42,838 —
Accrued expenses not currently deductible ..................... 38,330 60,821
Operating loss and credit carryovers .......................... 28,293 43,600
Warrants issuance ....................................... 27,160 34,105
Partnership income ...................................... 21,844 15,433
Sale of international non-mortgage purchased paper business........ 20,887 —
In-substance defeasance transactions .......................... 16,037 18,074
Other................................................. 29,186 31,688
Total deferred tax assets ................................... 1,855,925 1,515,751
Deferred tax liabilities:
Securitization transactions . . ............................... 302,049 370,378
Unrealized investment gains recorded to other comprehensive
income ............................................. — 124,459
Leases ................................................ 73,570 83,286
Depreciation/amortization . . ............................... — 23,031
Other................................................. 12,883 7,247
Total deferred tax liabilities . ............................... 388,502 608,401
Net deferred tax assets .................................... $1,467,423 $ 907,350
Included in other deferred tax assets is a valuation allowance of $4,901 and $7,635 as of December 31,
2008 and 2007, respectively, against a portion of the Company’s state and international deferred tax assets.
The ultimate realization of the deferred tax assets is dependent upon the generation of future taxable income
during the period in which the temporary differences become deductible. Management primarily considers the
scheduled reversals of deferred tax liabilities and the history of positive taxable income in making this
determination. The valuation allowance primarily relates to state deferred tax assets for which subsequently
recognized tax benefits will be allocated to goodwill.
As of December 31, 2008, the Company has federal net operating loss carryforwards of $56,438 which
begin to expire in 2022, apportioned state net operating loss carryforwards of $69,068 which begin to expire
in 2009, and federal and state credit carryovers of $1,921 which begin to expire in 2021.
F-88
SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, except per share amounts, unless otherwise stated)