iHeartMedia 2003 Annual Report Download - page 83

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NOTE I — INCOME TAXES
Significant components of the provision for income tax expense (benefit) are as follows:
Significant components of the Company’s deferred tax liabilities and assets as of December 31, 2003 and 2002 are as follows:
The deferred tax liability related to intangibles and fixed assets primarily relates to the difference in book and tax basis of acquired FCC
licenses and goodwill created from the Company’s various stock acquisitions. In accordance with Statement No. 142, the Company no longer
amortizes FCC licenses. Thus, a deferred tax benefit for the difference between book and tax amortization for the Company’s FCC licenses and
tax-deductible goodwill is no longer recognized, as these assets are no longer amortized for book purposes. As a result, this deferred tax
liability will not reverse over time unless the Company recognizes future impairment charges on its FCC licenses and tax deductible goodwill
or sells its FCC licenses. As the Company continues to amortize its tax basis in its FCC licenses and tax deductible goodwill, the deferred tax
liability will increase over time.
83
(In thousands)
2003 2002 2001
Current
—
federal $197,608 $102,785 $26,598
Current — foreign 25,542 33,594 19,450
Current
—
state 23,531 12,764 11,315
Total current 246,681 149,143 57,363
Deferred — federal 519,689 350,237 (137,213)
Deferred — foreign (31,142) (36,034) (13,462)
Deferred — state 44,545 30,020 (11,659)
Total deferred 533,092 344,223 (162,334)
Income tax expense (benefit) $779,773 $493,366 $(104,971)
(In thousands)
2003 2002
Deferred tax liabilities:
Intangibles and fixed assets $2,944,240 $2,605,842
Unrealized gain in marketable securities 208,854 —
Foreign 60,444 77,715
Equity in earnings 41,644 17,110
Investments 1,860 5,398
Other 11,830 12,417
Total deferred tax liabilities 3,268,872 2,718,482
Deferred tax assets:
Unrealized loss in marketable securities — 20,876
Accrued expenses 99,232 110,236
Long-term debt 97,167 81,044
Net operating loss carryforwards 9,522 21,438
Alternative minimum tax carryforwards
—
13,437
Bad debt reserves 17,473 21,259
Deferred income 20,028 13,416
Other 36,785 32,985
Total gross deferred tax assets 280,207 314,691
Valuation allowance 60,672 66,667
Total deferred tax assets 219,535 248,024
Net deferred tax liabilities $3,049,337 $2,470,458