Income Taxes

9 Months Ended

Sep. 30, 2012

Income Taxes [Abstract]

INCOME TAXES

5. INCOME TAXES

The Company bases its consolidated effective income tax rate for interim periods on its forecasted annual consolidated effective income tax rate, which includes estimates of the taxable income and revenue for jurisdictions in which the Company operates. Total tax expense then is allocated between continuing operations and discontinued operations. The following table presents the components of the Company’s provision for income taxes:

	For the three months ended September 30,					For the nine months ended September 30,
(In thousands)	2012			2011		2012			2011
Provision for/(benefit from) income taxes:
Continuing operations	$	779		$	2,378	$	3,032		$	5,587
Discontinued operations		(22	)		—		(108	)		—
Provision for income taxes	$	757		$	2,378	$	2,924		$	5,587

The Company’s full-year forecasted effective income tax rate for continuing operations was 44% and 37.5% for the nine months ended September 30, 2012 and 2011, respectively. The variances between the U.S. federal statutory rate of 35% and the Company’s forecasted effective income tax rate for the nine months ended September 30, 2012 and 2011 are primarily due to state income taxes and permanent items that are not deductible for U.S. tax purposes. As a comparison, the Company’s actual effective income tax rate for continuing operations for the year ended December 31, 2011 was 30%, which included approximately $2.4 million of foreign tax credits and certain valuation allowance reversals. Positively impacting the Company’s full-year forecasted effective income tax rate for the nine months ended September 30, 2011 was the Company’s ability to utilize foreign tax credits totaling $1.0 million, partially offset by approximately $0.7 million of non-deductible acquisition related costs.

As of September 30, 2012 and December 31, 2011, the Company’s reserve for uncertain tax positions totaled approximately $2.5 million and $2.6 million, respectively. Changes in this reserve could impact the Company’s effective tax rate in subsequent periods. The Company recognizes interest and penalties related to uncertain income tax positions in interest expense and selling, general and administrative expenses, respectively, in its unaudited Condensed Consolidated Statements of Comprehensive Income. As of September 30, 2012 and December 31, 2011, the Company’s reserves for interest and penalties related to uncertain tax positions totaled approximately $0.5 million and $0.4 million, respectively.

The Company continues to focus on tax planning strategies on a U.S. federal, state and local level, including continuing to work towards identifying opportunities to utilize its gross tax assets that have valuation allowances provided against them. Additionally, the Company will, on occasion, engage specialists, in some cases on a contingency basis, to evaluate filed returns and the methodologies used in those returns, to determine if the Company can further optimize its tax positions.