US Cellular 2011 Annual Report Download - page 58

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UNITED STATES CELLULAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 5 INCOME TAXES (Continued)
U.S. Cellular’s noncurrent deferred income tax assets and liabilities at December 31, 2011 and 2010 and
the temporary differences that gave rise to them were as follows:
December 31, 2011 2010
(Dollars in thousands)
Noncurrent deferred tax assets
Net operating loss (‘‘NOL’’) carryforwards ............... $ 48,565 $ 33,724
Stock-based compensation .......................... 19,079 17,204
Other ......................................... 36,195 38,998
103,839 89,926
Less valuation allowance ........................... (29,262) (28,252)
Total noncurrent deferred tax assets ................... 74,577 61,674
Noncurrent deferred tax liabilities
Property, plant and equipment ....................... 482,433 323,334
Licenses/intangibles ............................... 267,344 246,599
Partnership investments ............................ 120,941 71,566
Other ......................................... 3,049 3,619
Total noncurrent deferred tax liabilities .................. 873,767 645,118
Net noncurrent deferred income tax liability ............... $799,190 $583,444
At December 31, 2011, U.S. Cellular and certain subsidiaries had $890.4 million of state NOL
carryforwards (generating a $41.1 million deferred tax asset) available to offset future taxable income
primarily of the individual subsidiaries which generated the losses. The state NOL carryforwards expire
between 2012 and 2031. Certain subsidiaries had federal NOL carryforwards (generating a $7.5 million
deferred tax asset) available to offset future taxable income. The federal NOL carryforwards expire
between 2012 and 2031. A valuation allowance was established for certain state NOL carryforwards and
federal NOL carryforwards since it is more likely than not that a portion of such carryforwards will expire
before they can be utilized.
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
2011 2010 2009
(Dollars in thousands)
Unrecognized tax benefits balance at January 1, ................... $32,547 $34,442 $27,786
Additions for tax positions of current year ...................... 4,487 5,119 4,966
Additions for tax positions of prior years ....................... 332 550 3,114
Reductions for tax positions of prior years ...................... (1,104) (1,560) (1,399)
Reductions for settlements of tax positions ..................... (244) (5,938) —
Reductions for lapses in statutes of limitations ................... (7,273) (66) (25)
Unrecognized tax benefits balance at December 31, ................ $28,745 $32,547 $34,442
Unrecognized tax benefits are included in Accrued taxes and Other deferred liabilities and credits in the
Consolidated Balance Sheet. If these benefits were recognized, they would have reduced income tax
expense in 2011, 2010 and 2009 by $18.7 million, $21.1 million and $18.9 million, respectively, net of the
federal benefit from state income taxes.
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