Earthlink 2001 Annual Report Download - page 51

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F-25
12. Income Taxes
The provision (benefit) for income taxes is comprised of the following:
The following table summarizes the significant differences between the U.S. Federal statutory tax rate and the Company's effective tax
rate for financial statement purposes:
As a result of the tax-free merger with OneMain in September 2000, the Company acquired $32.9 million of additional deferred tax
liabilities primarily related to the customer base and related intangibles. Additionally, the Company acquired $49.4 million of additional
deferred tax assets, primarily related to net operating losses, in conjunction with the acquisition of Cidco in December 2001. These additional
deferred tax assets and liabilities impact the net change to the valuation allowance.
Deferred tax assets and liabilities include the following:
10.38
—
16.82
4,079
9.05
13.96
580
12.24
18.25
—
25.13
3,169
7.80
23.21
1,663
22.93
25.50
—
46.22
3,005
7.12
34.19
1,741
35.03
48.61
—
48.61
190
7.27
48.61
119
48.61
51.44
—
51.44
8
7.07
51.44
4
51.44
$ 0.26
—
$
51.44
21,022
7.98
$
15.66
8,404
$
16.64
Year Ended December 31,
1999
2000
2001
(In thousands)
Current
$
3,654
$
(6,654
)
$
—
Deferred
(3,654
)
4,260
—
$
—
$
(
2,394
)
$
—
Year Ended December 31,
1999
2000
2001
(In thousands)
Federal income tax (benefit) at statutory rate
$
(60,793
)
$
(121,911
)
$
(119,372
)
State income taxes, net of federal benefit
(8,915
)
(13,842
)
(12,633
)
Nondeductible goodwill and acquisition costs
7,735
12,905
13,389
Net change to valuation allowance
62,083
119,908
121,633
Other
(110
)
546
(3,017
)
$
—
$
(
2,394
)
$
—
December 31,
2000
2001
(In thousands)
Deferred tax assets:
Net operating losses
$
179,140
$
243,881
Accrued liabilities and reserves
10,188
13,067
Member base and other intangibles —
77,390