TripAdvisor 2011 Annual Report Download - page 97

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Table of Contents
Our deferred tax assets and deferred tax liabilities as of December 31, 2011 and 2010 are as follows:
At December 31, 2011, we had federal, state and foreign net operating loss carryforwards (“NOLs”) of approximately $7 million, $15
million and $29 million. If not utilized, the federal and state NOLs will expire at various times between 2020 and 2031 and the foreign NOLs
will expire at various times between 2012 and 2016.
At December 31, 2011, we had a valuation allowance of approximately $9 million related to the portion of net operating loss carryforwards
and other items for which it is more likely than not that the tax benefit will not be realized. This amount represented an increase of $1.5 million
over the amount recorded as of December 31, 2010.
We have not provided for deferred U.S. income taxes on undistributed earnings of certain foreign subsidiaries that we intend to reinvest
permanently outside the United States; the total amount of such earnings as of December 31, 2011 and 2010 was $258 million and $137 million,
respectively. Should we distribute or be treated under certain U.S. tax rules as having distributed earnings of foreign subsidiaries in the form of
dividends or otherwise, we may be subject to U.S. income taxes. Due to complexities in tax laws and various assumptions that would have to be
made, it is not practicable to estimate the amount of unrecognized deferred U.S. taxes on these earnings.
A reconciliation of the provision for income taxes to the amounts computed by applying the statutory federal income tax rate to income
before income taxes is as follows:
93
December 31,
2011
2010
(In thousands)
Deferred tax assets:
Stock
-
based compensation
$
17,596
$
2,181
Net operating loss carryforwards
9,415
8,402
Provision for accrued expenses
5,950
6,758
Other
4,597
4,221
Total deferred tax assets
37,558
21,562
Less valuation allowance
(9,239
)
(7,734
)
Net deferred tax assets
$
28,319
$
13,828
Deferred tax liabilities:
Intangible assets
$
(26,699
)
$
(23,220
)
Property and equipment
(10,059
)
(9,032
)
Prepaid expenses
(923
)
(439
)
Other
(148
)
(2,071
)
Total deferred tax liabilities
$
(37,829
)
$
(34,762
)
Net deferred tax liability
$
(9,510
)
$
(20,934
)
Year Ended December 31,
2011
2010
2009
(In thousands)
Income tax expense at the federal statutory rate of 35%
$
95,163
$
78,545
$
58,289
Foreign rate differential
(15,319
)
(6,947
)
(3,604
)
State income taxes, net of effect of federal tax benefit
4,240
7,716
6,742
Unrecognized tax benefits and related interest
2,570
1,920
440
Non
-
deductible transaction costs
2,426
—
—
Change in valuation allowance
3,451
3,639
1,987
Other, net
1,572
588
471
Provision for income taxes
$
94,103
$
85,461
$
64,325