American Home Shield 2009 Annual Report Download - page 102

Table of Contents
Notes to the Consolidated Financial Statements (Continued)
Note 6. Income Taxes (Continued)
Income tax expense from continuing operations is as follows:
Successor 2009
(In thousands) Current Deferred Total
U.S. federal $ (6,708) $ 7,580 $ 872
Foreign 2,356 629 2,985
State and local 14,254 (22,501) (8,247)
$ 9,902 $ (14,292) $ (4,390)
Successor 2008
Current Deferred Total
U.S. federal $ — $ (47,685) $ (47,685)
Foreign — 2,526 2,526
State and local 11,958 (5,099) 6,859
$ 11,958 $ (50,258) $ (38,300)
Successor period from
Jul. 25, 2007 to Dec. 31, 2007
Current Deferred Total
U.S. federal $ 14,927 $ (67,876) $ (52,949)
Foreign 2,184 45 2,229
State and local 493 (1,955) (1,462)
$ 17,604 $ (69,786) $ (52,182)
Predecessor period From
Jan. 1, 2007 to Jul. 24, 2007
Current Deferred Total
U.S. federal $ 18,601 $ 28,289 $ 46,890
Foreign 1,086 (84) 1,002
State and local 1,562 2,238 3,800
$ 21,249 $ 30,443 $ 51,692
Deferred income tax expense results from timing differences in the recognition of income and expense for income tax and financial reporting purposes.
Deferred income tax balances reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting
and income tax purposes. The deferred tax asset primarily reflects the impact of future tax deductions related to the Company's accruals and certain net
operating loss carryforwards. The deferred tax liability is primarily attributable to the basis differences related to intangible assets. Valuation allowances are
recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. The valuation allowance for deferred tax assets as
of December 31, 2009 was $15.5 million. The net change in the total valuation allowance for the year ended December 31, 2009 was a decrease of $1.4
million.
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