Zynga 2013 Annual Report Download - page 93

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Table of Contents
The reconciliation of federal statutory income tax provision (benefit) to our effective income tax provision is as follows (in thousands):
We have not provided U.S. income taxes and foreign withholding taxes on the undistributed earnings of our profitable foreign subsidiaries
as of December 31, 2013 because we intend to permanently reinvest such earnings outside the United States. If these foreign earnings were to be
repatriated in the future, the related U.S. tax liability may be reduced by any foreign income taxes previously paid on these earnings. As of
December 31, 2013, the cumulative amount of earnings upon which U.S. income taxes have not been provided is approximately $2.4 million.
Deferred tax assets and liabilities consist of the following (in thousands):
89
Year Ended December 31,
2013
2012
2011
Expected provision (benefit) at U.S. federal statutory rate
$
(22,704
)
$
(55,837
)
$
(142,166
)
State income taxes
—
net of federal benefit
(15,947
)
(370
)
(6,340
)
Income taxed at foreign rates
4,024
48,427
6,338
Stock
-
based compensation
6,741
29,998
43,064
Tax credits
(39,593
)
(8,026
)
(34,769
)
Tax reserve for uncertain tax positions
30,224
48,252
29,303
Change in valuation allowance
28,354
(8,005
)
101,489
Change in earnings mix
(16,306
)
—
—
Impact of change in tax rates
(1,530
)
(566
)
(205
)
Acquisition costs
(1,480
)
(4,960
)
397
Other
330
960
1,063
$
(27,887
)
$
49,873
$
(1,826
)
Year Ended December 31,
2013
2012
Deferred tax assets:
Tax credit carryforwards
$
60,745
$
27,502
Equity based compensation
28,164
68,644
Net operating loss carryforwards
14,892
12,810
Acquired intangible assets
7,183
—
Accrued expenses
6,856
2,764
Deferred revenue
5,984
16,200
Charitable contributions
5,130
4,836
Deferred rent
4,620
6,014
State taxes
2,725
2,765
Other
679
1,926
Other accrued compensation
190
5,031
Valuation allowance
(92,095
)
(90,382
)
Net deferred tax assets
45,073
58,110
Deferred tax liabilities:
Depreciation
(21,356
)
(52,252
)
Prepaid expenses
—
(
320
)
Net deferred tax liabilities
(21,356
)
(52,572
)
Net deferred taxes
$
23,717
$
5,538