INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2012

Schedule Of Effective Income Tax Rate Reconciliation

Capstead’s effective tax rate differs substantially from statutory federal income tax rates primarily due to the benefit of Capstead REIT’s status as a REIT, as illustrated below, along with other items affecting the Company’s effective tax rate (in thousands):

	Year Ended December 31
	2012			2011			2010
Income taxes computed at the federal statutory rate	$	57,269		$	37,171		$	44,414
Benefit of REIT status		(57,268	)		(37,183	)		(44,437	)
Income taxes computed on income of Capstead’s sole taxable REIT subsidiary		1			(12	)		(23	)
Change in net deferred income tax assets		(1	)		22			23
Other		—			(10	)		—
Income tax provision	$	—		$	—		$	—

Components Of Deferred Tax Assets And Liabilities

received in 2010 pertaining to taxes paid in 2003. Significant components of the Company’s taxable REIT subsidiary’s deferred income tax assets and liabilities were as follows (in thousands):

	December 31
	2012		2011
Deferred income tax assets:
Alternative minimum tax credit (a)	$	1,940	$	1,940
Net operating loss carryforwards (b)		60		60
Other		22		23
		2,022		2,023
Deferred income tax liabilities		—		—
Net deferred tax assets	$	2,022	$	2,023
Valuation allowance (c)	$	2,022	$	2,023

(a) Alternative tax credit carryforwards can be utilized to offset payment of federal income taxes on future taxable income, if any, earned by this subsidiary, subject to certain limitations.

(b) Excludes $3.4 million in remaining net operating loss carryforwards which expire after 2019. To the extent these carryforwards are utilized in future periods, the benefit will reduce actual taxes payable.

(c) Because this subsidiary is not expected to earn significant amounts of taxable income, related net deferred tax assets are fully reserved at December 31, 2012.