Juno 2012 Annual Report Download - page 162

Table of Contents
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
beginning and ending amounts of gross unrecognized tax benefits (before federal impact of state items), excluding interest and penalties, was as follows
(in thousands):
The reductions in gross unrecognized tax benefits in the current year relate primarily to the settlement of a state income tax audit, as well as the
lapse of statutes of limitations.
The Company files income tax returns in the U.S., various state and local jurisdictions, the U.K., Germany, and certain other foreign jurisdictions.
The Company is currently under audit by the Internal Revenue Service ("IRS") and certain state and local tax authorities. The audits are in varying
stages of completion. The Company evaluates its tax positions and establishes liabilities for uncertain tax positions that may be challenged by tax
authorities. Uncertain tax positions are reviewed on an ongoing basis and are adjusted in light of changing facts and circumstances, including progress
of tax audits, case law developments and closing of statutes of limitations. Such adjustments are reflected in the provision for income taxes, as
appropriate. Tax years prior to 2009 are generally not subject to examination by the IRS except for items involving tax attributes that have been carried
forward to tax years whose statute of limitations remains open. With few exceptions, the Company is not subject to state or local examinations for years
prior to 2008. The Company is generally not able to reliably estimate the ultimate settlement amounts until the close of the audit. While the Company
does not expect material changes, it is possible that the amount of unrecognized benefit with respect to its uncertain tax positions could significantly
increase or decrease within the next 12 months related to the Company's ongoing audits. At this time, the Company is unable to make a reasonable
estimate of the range of impact on the balance of uncertain tax positions or the impact on the effective income tax rate related to such positions.
The Company had $1.7 million and $1.4 million accrued for interest and penalties relating to uncertain tax positions at December 31, 2012 and
2011, respectively, all of which is included in income taxes payable. The Company recognized net interest and penalties totaling $0.9 million,
$0.5 million and $0.1 million for the years ended December 31, 2012, 2011 and 2010, respectively.
At December 31, 2012 and 2011, U.S. income taxes were not provided on $4.7 million and $4.7 million, respectively, of undistributed earnings of
the Company's India subsidiary because such earnings have been permanently reinvested in foreign operations. The determination of taxes associated
with the undistributed earnings is not practicable. The Company provided for U.S. income taxes on the earnings of its U.K. and German subsidiaries.
F-45
 
     
Beginning balance $ 4,292 $ 8,530 $ 9,729
Additions for current year tax positions 263 965 743
Additions for prior year tax positions 1,171 527 475
Reductions related to settlements with taxing authorities (470) (5,387) —
Reductions due to lapse in statutes of limitations (426) (343) (2,417)
Ending balance $ 4,830 $ 4,292 $ 8,530