INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2012

Components of Income Tax Expense (Benefit)

The components of income tax expense (benefit) for the years ended December 31, 2012, 2011 and 2010 are as follows:

	2012		2011		2010
Current
Federal	$	-		-	$	-
State		-		-		-
Total current		-		-		-

Deferred
Federal		-		473		(375	)
State		-		-		-
Total deferred		-		473		(375	)
Total income tax expense (benefit)	$	-		473	$	(375	)

Components of Deferred Income Tax Assets and Liabilities

Deferred income taxes reflect the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of deferred income tax assets and liabilities as of December 31, 2012 and 2011 are as follows:

	2012		2011
Deferred income tax assets
Tax over book basis of land inventory	$	14,564	$	14,524
Unrecoverable land development costs		6,622		6,965
Executive incentive compensation		1,099		548
Net operating loss carry forward		33,872		19,987
Impairment charges		74,551		56,973
Other		5,428		5,945
Total deferred income tax assets		136,136		104,942
Valuation allowance for deferred tax assets		(126,533)		(91,483	)
Net deferred income tax assets		9,603		13,459
Deferred income tax liability
Book over tax income recognized on sale of the Ocala Property		(9,118)		(12,899	)
Tax over book on 4.50% Convertible Notes		(696)		(767	)
Book over tax basis of depreciable assets		211		207
Restricted stock		-		-
		(9,603)		(13,459	)
Net deferred income tax liability	$	-	$	-

Reconciliation of Income Tax Expense (Benefit)

A reconciliation of income tax expense (benefit) to the expected income tax expense (benefit) at the federal statutory rate of 35% for each of the years ended December 31, 2012, 2011 and 2010 is as follows:

	2012		2011			2010
Income tax (benefit) expense computed at statutory rate	$	(31,582)		(57,893	)	$	(12,419	)
State income tax (benefit) expense, net of federal benefit		(3,388)		(6,521	)		(1,200	)
Adjustment to 2009 net operating loss carryback		-		-			795
Change in valuation allowance on deferred tax assets		35,050		68,961			12,103
Prior period adjustments charged to retained earnings		-		(4,044	)		-
Other		(80)		(30	)		346
Income tax (benefit) expense	$	-		473		$	(375	)