Income Taxes

6 Months Ended

Jun. 30, 2013

Income Taxes

Income Taxes

Note 11—Income Taxes

The following table summarizes the activity relating to the Company’s unrecognized tax benefits during the six months ended June 30, 2013 (in thousands):

	Total
Balance at December 31, 2012	$	12,148
Gross increases related to current period tax positions	1,577
Balance at June 30, 2013	$	13,725

At June 30, 2013 and December 31, 2012, Advent had gross unrecognized tax benefits of $13.7 million and $12.1 million, respectively. During the six months ended June 30, 2013, the Company increased the amount of unrecognized tax benefits by approximately $1.4 million relating to federal research credits, California research credits, Massachusetts research credits and California enterprise zone credits. If recognized, the total unrecognized tax benefits would decrease Advent’s tax provision and increase net income by $11.4 million. The impact on net income reflects the liabilities for unrecognized tax benefits, net of the federal tax benefit of state income tax items. The Company’s liabilities for unrecognized tax benefits relate primarily to federal research credits, California research and enterprise zone tax credits and various state net operating losses.

Advent is subject to taxation in the U.S. and various states and jurisdictions outside the U.S. Advent is currently undergoing a State of California franchise tax examination for the 2006 and 2007 tax years and a New York State franchise tax examination for the 2008, 2009 and 2010 tax years. Advent is not under examination in any other income tax jurisdiction at the present time and does not anticipate the total amount of its unrecognized tax benefits to significantly change over the next 12 months. The material jurisdictions that are subject to examination by tax authorities include federal for tax years after 2008 and California for tax years after 2005.

As of June 30, 2013, Advent made no provision for a cumulative total of $11.7 million of undistributed earnings for certain non-U.S. subsidiaries, which are deemed to be permanently reinvested.