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Table of Contents VMware, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
VMware’s provision for income taxes consisted of the following (table in thousands):
A reconciliation of VMware’s income tax rate to the statutory federal tax rate is as follows:
Deferred tax assets and liabilities are recognized for future tax consequences of differences between the carrying amounts of assets and
liabilities and their respective tax bases using enacted tax rates in effect for the year in which the differences are expected to be reversed.
Significant deferred tax assets and liabilities consist of the following (table in thousands):
86
For the Year Ended December 31,
2012
2011
2010
Federal:
Current
$
161,273
$
42,772
$
65,796
Deferred
(70,858
)
(23,566
)
(42,158
)
90,415
19,206
23,638
State:
Current
13,248
721
15,496
Deferred
(7,641
)
11,353
(9,055
)
5,607
12,074
6,441
Foreign:
Current
44,043
41,351
34,592
Deferred
7,347
(2,154
)
(5,735
)
51,390
39,197
28,857
Total provision for income taxes
$
147,412
$
70,477
$
58,936
For the Year Ended December 31,
2012
2011
2010
Statutory federal tax rate
35.0
%
35.0
%
35.0
%
State taxes, net of federal benefit
0.6
%
1.5
%
1.5
%
Tax rate differential for international jurisdictions
(22.4
)%
(25.1
)%
(17.3
)%
U.S. tax credits
(0.2
)%
(6.2
)%
(8.6
)%
Permanent items and other
3.5
%
3.7
%
3.6
%
Effective tax rate
16.5
%
8.9
%
14.2
%
December 31,
2012
2011
Deferred tax assets:
Unearned revenue
$
210,741
$
126,270
Accruals and other
43,331
54,150
Stock-based compensation
64,687
56,074
Tax credit and net operating loss carryforwards
130,139
133,080
Net deferred tax assets
448,898
369,574
Valuation allowance
(63,955
)
(56,573
)
Total deferred tax assets
384,943
313,001
Deferred tax liabilities:
Property, plant and equipment, net
(51,079
)
(21,162
)
Intangibles and other assets, net
(54,650
)
(7,360
)
Total deferred tax liabilities
(105,729
)
(28,522
)
Total deferred tax assets, net
$
279,214
$
284,479