NOTE E — INCOME TAXES

The income tax provision (benefit) attributable to continuing operations for the years ended December 31, 2014, 2013, and 2012, consists of the following:



	Year Ended December 31,
	2014			2013			2012
	(In Thousands)
Current
Federal	$	(69	)	$	530		$	1,362
State	(195		)	(225		)	683
Foreign	10,318			6,065			9,396
	10,054			6,370			11,441
Deferred
Federal	(1,509		)	(6,685		)	(361		)
State	3,784			(1,121		)	(495		)
Foreign	(2,625		)	(2,018		)	(1,156		)
	(350		)	(9,824		)	(2,012		)
Total tax provision (benefit)	$	9,704		$	(3,454	)	$	9,429

A reconciliation of the provision (benefit) for income taxes attributable to continuing operations, computed by applying the federal statutory rate for the years ended December 31, 2014, 2013, and 2012, to income before income taxes and the reported income taxes, is as follows:



	Year Ended December 31,
	2014			2013			2012
	(In Thousands)
Income tax provision (benefit) computed at statutory federal income tax rates	$	(55,254	)	$	(45	)	$	9,864
State income taxes (net of federal benefit)	(1,730		)	(608		)	1,163
Nondeductible meals and entertainment	1,433			1,382			1,460
Impact of international operations	(7,408		)	(3,504		)	(2,697		)
Goodwill impairments	7,442			—			—
Valuation allowance	67,781			(301		)	(721		)
Other	(2,560		)	(378		)	360
Total tax provision (benefit)	$	9,704		$	(3,454	)	$	9,429

The provision (benefit) for income taxes includes amounts related to the anticipated repatriation of certain earnings of our non-U.S. subsidiaries. Undistributed earnings above the amounts upon which taxes have been provided, which was $37.0 million at December 31, 2014, are intended to be permanently invested. It is not practicable to determine the amount of applicable taxes that would be incurred if any such earnings were repatriated.

Income (loss) before taxes and discontinued operations includes the following components:



	Year Ended December 31,
	2014			2013			2012
	(In Thousands)
Domestic	$	(138,639	)	$	(14,322	)	$	2,206
International	(19,231		)	14,194			25,977
Total	$	(157,870	)	$	(128	)	$	28,183

A reconciliation of the beginning and ending amount of our gross unrecognized tax benefit liability is as follows:



	Year Ended December 31,
	2014			2013			2012
	(In Thousands)
Gross unrecognized tax benefits at beginning of period	$	2,018		$	2,327		$	1,552
Additions related to acquisitions	—			—			742
Increases in tax positions for prior years	—			—			—
Decreases in tax positions for prior years	—			(118		)	—
Increases in tax positions for current year	191			202			313
Settlements	—			—			—
Lapse in statute of limitations	(250		)	(393		)	(280		)
Gross unrecognized tax benefits at end of period	$	1,959		$	2,018		$	2,327

We recognize interest and penalties related to uncertain tax positions in income tax expense. During the years ended December 31, 2014, 2013, and 2012, we recognized $0.2 million, $(0.2) million, and $0.3 million, respectively, of interest and penalties to the provision for income tax. As of December 31, 2014 and 2013, we had $2.1 million and $2.1 million, respectively, of accrued potential interest and penalties associated with these uncertain tax positions. The total amount of unrecognized tax benefits that would affect our effective tax rate if recognized is $2.1 million and $2.1 million as of December 31, 2014 and 2013, respectively. We do not expect a significant change to the unrecognized tax benefits during the next twelve months.

We file tax returns in the U.S. and in various state, local, and non-U.S. jurisdictions. The following table summarizes the earliest tax years that remain subject to examination by taxing authorities in any major jurisdiction in which we operate:



Jurisdiction	Earliest Open Tax Period
United States – Federal	2013
United States – State and Local	2002
Non-U.S. jurisdictions	2008

We use the liability method for reporting income taxes, under which current and deferred tax assets and liabilities are recorded in accordance with enacted tax laws and rates. Under this method, at the end of each period, the amounts of deferred tax assets and liabilities are determined using the tax rate expected to be in effect when the taxes are actually paid or recovered. We will establish a valuation allowance to reduce the deferred tax assets when it is more likely than not that some portion or all of the deferred tax assets will not be realized. We considered all available evidence, both positive and negative, in determining whether, based on the weight of that evidence, a valuation allowance is needed for some portion or all of our deferred tax assets. In determining the need for a valuation allowance on our deferred tax assets we placed greater weight on recent and objectively verifiable current information, as compared to more forward-looking information that is used in valuating other assets on the balance sheet. While we have considered tax planning strategies in assessing the need for the valuation allowance, there can be no guarantee that we will be able to realize all of our deferred tax assets. Significant components of our deferred tax assets and liabilities as of December 31, 2014 and 2013, are as follows:



	December 31,
	2014			2013
	(In Thousands)
Net operating losses	$	88,867		$	51,130
Foreign tax credits and alternative minimum tax credits	15,910			10,233
Accruals	35,135			30,057
All other	2,855			2,167
Total deferred tax assets	142,767			93,587
Valuation allowance	(73,696		)	(3,747		)
Net deferred tax assets	$	69,071		$	89,840



	December 31,
	2014		2013
	(In Thousands)
Depreciation and amortization for tax in excess of book expense	$	77,751	$	88,030
All other	844		4,730
Total deferred tax liability	78,595		92,760
Net deferred tax liability	$	9,524	$	2,920

The change in the valuation allowance during 2014 primarily relates to the increase in allowance associated with federal and state deferred tax assets. The increase (decrease) in the valuation allowance during the years ended December 31, 2014, 2013, and 2012 were $69.9 million, $(0.3) million, and $(0.7) million, respectively. We believe that it is more likely than not we will not realize all the tax benefits of the deferred tax assets within the allowable carryforward period. Therefore, an appropriate valuation allowance has been provided.

At December 31, 2014, we had approximately $88.9 million of federal, foreign and state net operating loss carryforwards. In those countries and states in which net operating losses are subject to an expiration period, our loss carryforwards, if not utilized, will expire at various dates from 2015 through 2034. At December 31, 2014, we had $15.0 million of foreign tax credits available to offset future payment of federal income taxes. The foreign tax credits expire in varying amounts from 2020 through 2024.