Note 13 - Income Taxes

3 Months Ended

Mar. 31, 2012

Income Tax Disclosure [Text Block]

NOTE 13:  INCOME TAXES

We file income tax returns with federal, state, local and foreign jurisdictions.  As of March 31, 2012, we remain subject to examinations of our U.S. federal and state income tax returns for the years ended June 30, 2002 through June 30, 2011, Canadian income tax returns for the years ended June 30, 2004 through June 30, 2011 and German tax filings for the years ended June 30, 2004 through June 30, 2011.  We are currently under a US income tax audit for the years ended June 30, 2009 and June 30, 2010.

During the nine months ended March 31, 2012, we recorded tax benefits of $9,420 for exchange of CBCs from AFMCs.  During the nine months ended March 31, 2011, we recorded tax benefits of $20,462 for CBCs claimed on black liquor without diesel for the period January 1, 2009 through February 11, 2009, and $31,162 for exchange of CBCs from AFMCs.  See additional discussion at Note 5 to the condensed consolidated financial statements.

The net deferred tax asset balance changed from $29,485 as of June 30, 2011 to $48,352 as of March 31, 2012.  The most significant component of this change was due to the increase in the expected alternative fuel mixture credit conversion to cellulosic biofuel credits.

During the three and nine months ended March 31, 2012, we recorded tax benefits of $1,070 and $2,724, respectively, for IRS Section 48 energy investment tax credits related to the Foley Energy Project.

Our effective tax rates for the three and nine month periods ended March 31, 2012 were 33.6% and 10.4%, respectively.  Our effective tax rate for the same periods in 2011 were 30.8% and (26.8)%, respectively.  Our income tax expense (benefit) differs from the amount computed by applying the statutory federal income tax rate of 35% to income before income taxes due to the following:

	Three Months Ended March 31						Nine Months Ended March 31
	2012			2011			2012			2011
Expected tax expense at 35%	$	13,614		$	14,519		$	24,024		$	30,414
Cellulosic biofuel credits		-			-			(9,420	)		(51,624	)
Loss on Americana investment		-			-			(6,567	)		-
Energy investment tax credits		(1,070	)		(794	)		(2,724	)		(2,462	)
Change in valuation allowance		752			488			613			2,183
Other		(244	)		(1,424	)		1,200			(1,785	)
Income tax (benefit) expense	$	13,052		$	12,789		$	7,126		$	(23,274	)