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68 I AMERCO ANNUAL REPORT
Amerco and Consolidated Entities
Notes to Consolidated Financial Statements, continued
Under฀ the฀ provisions฀ of฀ the฀ Tax฀ Reform฀ Act฀ of฀ 1984฀
(the฀ Act),฀ the฀ balance฀ in฀ Oxford’s฀ account฀ designated฀
“Policyholders’฀ Surplus฀ Account”฀ is฀ frozen฀ at฀ its฀
December฀ 31,฀ 1983฀ balance฀ of฀ $19.3฀ million.฀ Federal฀
income฀ taxes฀ (Phase฀ III)฀ will฀ be฀ payable฀ thereon฀ at฀
applicable฀ current฀ rates฀ if฀ amounts฀ in฀ this฀ account฀ are฀
distributed฀to฀the฀stockholder฀or฀to฀the฀extent฀the฀account฀
exceeds฀a฀prescribed฀ maximum.฀Oxford฀did฀not฀incur฀a฀
Phase฀III฀liability฀for฀the฀years฀ended฀December฀31,฀2004,฀
2003฀and฀2002.
At฀March฀31,฀2005฀and฀March฀31,฀2004,฀the฀AMERCO฀
affiliated฀ group฀ has฀ non-life฀ net฀ operating฀ loss฀
carryforwards฀available฀to฀offset฀federal฀taxable฀income฀in฀
future฀years฀of฀$0฀and฀$95.4฀million,฀respectively.฀These฀
carryforwards฀ expire฀ in฀ 2012฀ through฀ 2020.฀ At฀ March฀
31,฀2005฀and฀March฀31,฀2004,฀AMERCO฀has฀alternative฀
minimum฀tax฀credit฀carryforwards฀of฀$19.1฀million฀and฀
$9.6฀million,฀respectively,฀which฀do฀not฀have฀an฀expiration฀
date,฀and฀may฀only฀be฀utilized฀in฀years฀in฀which฀regular฀
tax฀exceeds฀alternative฀minimum฀tax.฀At฀March฀31,฀2005฀
and฀ March฀ 31,฀ 2004,฀ U-HAUL฀ Co.฀ (Canada)฀ Ltd.฀ has฀
net฀ Canadian฀ operating฀ loss฀ carryforwards฀ available฀ to฀
offset฀ Canadian฀ taxable฀ income฀ of฀ $5.5฀ million,฀ stated฀
in฀U.S.฀dollars.฀These฀carryforwards฀expire฀in฀2012฀and฀
2011฀respectively.
SAC฀Holdings฀began฀to฀file฀tax฀returns฀in฀the฀fiscal฀year฀
ending฀March฀31,฀ 2003,฀and฀has฀net฀operating฀losses฀of฀
$20.6฀million฀and฀$14.2฀million฀in฀the฀fiscal฀years฀ending฀
March฀31,฀2005฀and฀March฀31,฀2004,฀respectively,฀to฀offset฀
taxable฀ income฀ in฀ future฀ years.฀ These฀ carryforwards฀
expire฀in฀2024฀and฀2025.
Under฀certain฀circumstances฀and฀sections฀of฀the฀Internal฀
Revenue฀Code,฀ a฀change฀in฀ ownership฀for฀ tax฀ purposes฀
will฀limit฀the฀amount฀of฀net฀operating฀loss฀carryforwards฀
that฀can฀be฀used฀to฀offset฀future฀taxable฀income.
Note 14: Employee Benefit Plans
Profit Sharing Plans
The฀ Company฀ provides฀ tax-qualified฀ profit฀ sharing฀
retirement฀ plans฀ for฀ the฀ benefit฀ of฀ eligible฀ employees,฀
former฀ employees฀ and฀ retirees฀ in฀ the฀ U.S.฀ and฀ Canada.฀
The฀ plans฀ are฀ designed฀ to฀ provide฀ employees฀ with฀ an฀
accumulation฀ of฀ funds฀ for฀ retirement฀ on฀ a฀ tax-deferred฀
basis฀ and฀ provide฀ for฀ annual฀ discretionary฀ employer฀
contributions.฀Amounts฀to฀be฀contributed฀are฀determined฀
by฀ the฀ chief฀ executive฀ officer฀ of฀ the฀ Company฀ under฀
the฀delegation฀of฀authority฀from฀the฀Board฀of฀Directors,฀
pursuant฀ to฀ the฀ terms฀ of฀ the฀ Profit฀ Sharing฀ Plan.฀ No฀
contributions฀were฀made฀to฀the฀profit฀sharing฀plan฀during฀
fiscal฀2005,฀2004฀or฀2003.
The฀ Company฀ also฀ provides฀ an฀ employee฀ savings฀ plan฀
which฀allows฀participants฀to฀defer฀income฀under฀Section฀
401(k)฀of฀the฀Internal฀Revenue฀Code฀of฀1986.
AMERCO AND CONSOLIDATED ENTITIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ì (Continued)
Significant components of the Company's deferred tax assets and liabilities at fiscal year-ends were as
follows:
March 31,
2005 2004
(In thousands)
Deferred tax assets:
Net operating loss and credit carryforwards ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 27,183 $ 48,287
Accrued expensesÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 102,962 91,780
Deferred revenue from sale/leasebackÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì 9,772
Policy benefit and losses, claims and loss expenses payable, net ÏÏÏÏÏÏÏ 21,048 22,767
Unrealized gains and (losses) ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 7,235 (1,442)
Total deferred tax assets ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 158,428 171,164
Deferred tax liabilities:
Property, plant and equipment ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 214,562 211,682
Deferred policy acquistion costs ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 12,367 16,107
Other ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 9,623 7,175
Total deferred tax liabilities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 236,552 234,964
Net deferred tax liabilityÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 78,124 $ 63,800
Under the provisions of the Tax Reform Act of 1984 (the Act), the balance in Oxford's account
designated ""Policyholders' Surplus Account'' is frozen at its December 31, 1983 balance of $19.3 million.
Federal income taxes (Phase III) will be payable thereon at applicable current rates if amounts in this
account are distributed to the stockholder or to the extent the account exceeds a prescribed maximum. Oxford
did not incur a Phase III liability for the years ended December 31, 2004, 2003 and 2002.
At March 31, 2005 and March 31, 2004, the AMERCO affiliated group has non-life net operating loss
carryforwards available to offset federal taxable income in future years of $0 and $95.4 million, respectively.
These carryforwards expire in 2012 through 2020. At March 31, 2005 and March 31, 2004, AMERCO has
alternative minimum tax credit carryforwards of $19.1 million and $9.6 million, respectively, which do not
have an expiration date, and may only be utilized in years in which regular tax exceeds alternative minimum
tax. At March 31, 2005 and March 31, 2004, U-HAUL Co. (Canada) Ltd. has net Canadian operating loss
carryforwards available to offset Canadian taxable income of $5.5 million, stated in U.S. dollars. These
carryforwards expire in 2012 and 2011 respectively.
SAC Holdings began to file tax returns in the fiscal year ending March 31, 2003, and has net operating
losses of $20.6 million and $14.2 million in the fiscal years ending March 31, 2005 and March 31, 2004,
respectively, to offset taxable income in future years. These carryforwards expire in 2024 and 2025.
Under certain circumstances and sections of the Internal Revenue Code, a change in ownership for tax
purposes will limit the amount of net operating loss carryforwards that can be used to offset future taxable
income.
Note 14: Employee Benefit Plans
Profit Sharing Plans
The Company provides tax-qualified profit sharing retirement plans for the benefit of eligible employees,
former employees and retirees in the U.S. and Canada. The plans are designed to provide employees with an
F-26
Significant฀components฀of฀the฀Company’s฀deferred฀tax฀assets฀and฀liabilities฀at฀fiscal฀year-ends฀were฀as฀follows: