

NOTE 4.	INCOME TAXES

Income tax expense (benefit) includes the following components:



	Federal			State		Foreign	Total
2011
Current	$	100,479		20,219		135,152	255,850
Deferred	(4,335		)	270		—	(4,065	)
	$	96,144		20,489		135,152	251,785
2010
Current	$	76,745		13,558		118,991	209,294
Deferred	10,197			372		—	10,569
	$	86,942		13,930		118,991	219,863
2009
Current	$	62,865		10,908		90,311	164,084
Deferred	(1,388		)	(221	)	—	(1,609	)
	$	61,477		10,687		90,311	162,475

Income tax expense differs from amounts computed by applying the United States Federal income tax rate of 35% to earnings before income taxes as a result of the following:



	2011		2010	2009
Computed “expected” tax expense	$	223,310	197,424	141,005
Increase in income taxes resulting from:
State income taxes, net of Federal income tax benefit	13,318		9,054	6,947
Nondeductible stock compensation expense, net	12,877		10,254	11,586
Other, net	2,280		3,131	2,937
	$	251,785	219,863	162,475

The components of earnings before income taxes are as follows:



	2011		2010	2009
United States	$	212,308	196,382	117,889
Foreign	425,720		367,686	284,983
	$	638,028	564,068	402,872

The tax effects of temporary differences and tax credits that give rise to significant portions of deferred tax assets and deferred tax liabilities are as follows:



Years ended December 31,	2011			2010
Deferred Tax Assets:
Accrued third party charges, deductible for taxes upon economic performance	$	9,220		6,503
Provision for doubtful accounts receivable	1,074			1,561
Excess of financial statement over tax depreciation	8,138			8,079
Deductible stock compensation expense, net	4,651			5,450
Foreign currency translation adjustment	1,625			—
Partnership basis difference	1,043			—
Retained liability for cargo claims	192			713
Total gross deferred tax assets	25,943			22,306
Deferred Tax Liabilities:
Unremitted foreign earnings, net of related foreign tax credits	(76,070		)	(78,112	)
Foreign currency translation adjustment	—			(4,453	)
Other	(71		)	(82	)
Total gross deferred tax liabilities	$	(76,141	)	(82,647	)
Net deferred tax liabilities	$	(50,198	)	(60,341	)
Current deferred tax assets	$	(10,415	)	(8,706	)
Noncurrent deferred tax liabilities	$	(60,613	)	(69,047	)

Based on management’s review of the Company’s tax positions, the Company had no significant unrecognized tax benefits as of December 31, 2011 and 2010.

The Company or one of its subsidiaries files income tax returns in the U.S. federal jurisdiction and various state, local and foreign jurisdictions. The Company is no longer subject to U.S. federal income tax examinations by tax authorities for years prior to 2008. With respect to state and local jurisdictions and countries outside of the United States, with limited exceptions, the Company and its subsidiaries are no longer subject to income tax audits for years prior to 2001. In the normal course of business, the Company is subject to examination by taxing authorities throughout the world. Although the outcome of tax audits is always uncertain, the Company believes that adequate amounts of tax, interest and penalties have been provided for any adjustments that may result from these open tax years. Any interest and penalties expensed in relation to the underpayment of income taxes were insignificant for the years ended December 31, 2011, 2010 and 2009.