US Cellular 2015 Annual Report Download - page 84

Significant components of TDS’ deferred income tax assets and liabilities at December 31, 2015 and 2014 were as
follows:
December 31, 2015 2014
(Dollars in thousands)
Deferred tax assets
Current deferred tax assets ............................................. $–$ 113,402
Net operating loss (‘‘NOL’’) carryforwards .................................... 137,574 135,676
Stock-based compensation ............................................. 61,680 54,789
Compensation and benefits – other ........................................ 37,744 11,014
Deferred rent ...................................................... 19,896 19,604
Other ........................................................... 92,787 35,523
Total deferred tax assets ................................................ 349,681 370,008
Less valuation allowance ............................................... (112,357) (113,553)
Net deferred tax assets ................................................. 237,324 256,455
Deferred tax liabilities
Property, plant and equipment ........................................... 672,473 667,540
Licenses/intangibles .................................................. 300,669 259,865
Partnership investments ............................................... 163,287 151,123
Other ........................................................... –9,724
Total deferred tax liabilities .............................................. 1,136,429 1,088,252
Net deferred income tax liability ............................................ $ 899,105 $ 831,797
TDS early adopted ASU 2015-17 as of December 31, 2015 using the prospective method. The change required by the
guidance, whereby all deferred taxes are classified as non-current, simplifies processes by eliminating the need to
separately identify the net current and net non-current deferred tax asset or liability in each jurisdiction and allocate
valuation allowances. The prior year Consolidated Balance Sheet and the deferred tax disclosure above were not
revised. At December 31, 2015, $900.1 million of net deferred income tax liability is included in Net deferred income tax
liability and $1.0 million is included in Other assets and deferred charges in the Consolidated Balance Sheet. At
December 31, 2014, $107.7 million of net current deferred income tax asset is included in Net deferred income tax asset
and $941.5 million of net noncurrent deferred income tax liability is included in Net deferred income tax liability and
$2.0 million is included in Other assets and deferred charges in the Consolidated Balance Sheet.
At December 31, 2015, TDS and certain subsidiaries had $2.4 billion of state NOL carryforwards (generating a
$114.2 million deferred tax asset) available to offset future taxable income. The state NOL carryforwards expire between
2016 and 2035. Certain subsidiaries had federal NOL carryforwards (generating a $23.4 million deferred tax asset)
available to offset their future taxable income. The federal NOL carryforwards expire between 2018 and 2035. 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 summary of TDS’ deferred tax asset valuation allowance is as follows:
2015 2014 2013
(Dollars in thousands)
Balance at beginning of year ....................................... $ 113,553 $ 79,064 $ 70,502
Charged (credited) to income tax expense ............................. (1,196) 34,489 1,954
Charged to other accounts ....................................... –– 6,608
Balance at end of year ........................................... $ 112,357 $ 113,553 $ 79,064
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TELEPHONE AND DATA SYSTEMS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS