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Income Taxes
6 Months Ended
Jun. 30, 2011
Income Taxes
11. Income Taxes

The Company accounts for income taxes under the provisions of ASC 740, using the liability method. ASC 740 requires recognition of deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax liabilities and assets are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the difference is expected to reverse.

The Company recognized income tax benefit of $0.1 million and income tax expense of $0.2 million during the three months ended June 30, 2011 and 2010, respectively, based upon its estimated annual effective rate by jurisdiction. The Company recognized income tax expense of $0.5 million and $0.7 million in the six months ended June 30, 2011 and 2010, respectively. The Company’s effective rate results in income tax expense primarily due to changes in the valuation allowance related to non-reversing deferred tax liabilities and the alternative minimum tax credit.

The Company does not believe there will be any material changes in its unrecognized tax positions over the next 12 months. The Company’s policy is that it recognizes interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense.

As of June 30, 2011 and December 31, 2010, the Company had federal net operating loss carryforwards of approximately $209.0 million and $207.7 million, respectively, which begin to expire in the year 2020. The net operating loss carryforwards are subject to various limitations under Section 382 of the Internal Revenue Code. Accordingly, the Company estimates that at least $130.3 million of net operating loss carryforwards will be available during the carryforward period.