XML 35 R16.htm IDEA: XBRL DOCUMENT v2.3.0.15
Income Taxes
9 Months Ended
Sep. 30, 2011
Income Taxes [Abstract] 
Income Tax Disclosure [Text Block]
Income Taxes

We use the asset and liability method of financial accounting and reporting for income taxes. Deferred income taxes reflect the tax impact of temporary differences between the amount of assets and liabilities recognized for financial reporting purposes and the amounts recognized for tax purposes. We classified interest expense and penalties related to unrecognized tax benefits as income tax expense. In the nine-month period ended September 30, 2011, we recorded a net tax benefit of $508, primarily related to the release of certain state and local tax positions and settlements.

The authoritative guidance clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements and prescribes a recognition threshold and measurement attribute for the recognition and measurement of a tax position taken or expected to be taken in a tax return. The evaluation of a tax position in accordance with this interpretation is a two-step process. The first step is recognition, in which the enterprise determines whether it is more likely than not that a tax position will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. The second step is measurement. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of the liability to recognize in the financial statements.

We determined, based upon the weight of available evidence, that it is more likely than not that most of our deferred tax asset will be realized. We have taxable temporary differences that can be used as a source of income. For the nine months ended September 30, 2011, we recorded valuation allowances of $17,292 for a deferred tax asset relating to a capital loss for the Metro Sale Transaction and $281 related to a portion of our deferred tax assets related to our state net operating loss carryforward. No valuation allowance was recorded during the three or nine month periods ended September 30, 2010 or for the year ended December 31, 2010. We will continue to assess the need for changes to the valuation allowance at each future reporting period.

The Metro Sale Transaction resulted in an accounting gain of $19,726 and a capital loss for income tax purposes due to difference between book and tax basis in part due to a book goodwill impairment charge. We have concluded that it is more likely than not that we will not realize a benefit from this capital loss,except to the extent of the capital gain from the sale of our 24/7 formats in the third quarter of 2011. Accordingly, a full valuation allowance was recorded in the second quarter of 2011 and partially released in the third quarter of 2011. Therefore, no net tax expense/benefit was provided for the Metro Sale Transaction in the second quarter of 2011.