Note 3 - Income Taxes

9 Months Ended

Sep. 30, 2015

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

Note 3.   Income Taxes

Major components of our income tax provision (benefit) for the three and nine months ended September 30, 2015 and 2014 are as follows (in thousands):

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2015			2014			2015			2014
Current:
Domestic	$	(4,776	)	$	(778	)	$	(2,911	)	$	4,529
Foreign		451			3			606			386
Total current income tax provision (benefit)		(4,325	)		(775	)		(2,305	)		4,915
Deferred:
Domestic		1,812			2,043			5,400			(4,973	)
Foreign		(2,987	)		(1,088	)		(7,288	)		(1,004	)
Total deferred income tax provision (benefit)		(1,175	)		955			(1,888	)		(5,977	)
Total income tax provision (benefit)	$	(5,500	)	$	180		$	(4,193	)	$	(1,062	)

As of September 30, 2015, we have a net deferred tax asset in the U.S. of $ 112.6 million and a net deferred tax liability in Canada of $126.3 million for a consolidated worldwide net deferred tax liability of $13.7 million. Our ability to utilize our deferred tax assets depends on future taxable income generated from operations within the United States; valuation allowances are provided for that portion of our deferred tax assets for which we believe it is more likely than not that we will not realize a benefit.  This judgment is based on several assumptions and estimates including life-of-mine operating plans and our estimates of future metals prices. At September 30, 2015 and December 31, 2014, the balances of the valuation allowances on our deferred tax assets were $42 million and $32 million, respectively, primarily for net operating loss carryforwards.

During the quarter ended September 30, 2015, there was a change in judgment about the realizability of our deferred tax assets in the U.S. Based on revised projections of future taxable income, certain tax net operating losses are projected to expire before utilization. The valuation allowance in the U.S. increased to $19.7 million based on this change in judgment.

The current income tax provisions for the three and nine months ended September 30, 2015 and 2014 vary from the amounts that would have resulted from applying the statutory income tax rate to pre-tax income primarily due to the effects of percentage depletion for all periods presented, the impact of taxation in foreign jurisdictions, and the change in valuation allowance.