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Federal Income Taxes (Tables)
 12 Months Ended
Dec. 31, 2012
Schedule of Income Tax Expense (Benefit)

The Company recorded an income tax benefit for the period ended December 31, 2010 due to forgiveness of indebtedness exchanged for certain tax benefits.

 

     2012      2011      2010  

Current federal income tax expense

    $     —         $     —           33,401    

Provision for doubtful federal income tax receivable

      —           —           (46,428)   

Deferred federal income tax (benefit) expense

      —           —           —      
  

 

 

     

 

 

     

 

 

  

Federal income tax benefit

    $ —         $ —         $ (13,027)   
  

 

 

     

 

 

     

 

 

  
Schedule of Effective Income Tax Rate Reconciliation

The items accounting for the difference between income taxes computed at the US federal statutory rate and our effecive rate were as follows:

 

     Successor            Predecessor      Predecessor      Predecessor  
     Period from
March 20,
2012 through
December 31, 2012		            Period from
January 1, 2012
through March 19,
2012		      Year ended
December 31,
2011		      Year ended
December 31,
2010		  

Income tax at the federal statutory rate of 35%

      (35)%              (35)%         (35)%         (35)%   

Effect of:

                 

Tax benefit recovered from parent in bankruptcy

      —                    —               —               (610)       

Fresh start accounting adjustments

      —                    —               (3)             (7)       

Worthless stock deduction

      (23,718)                 —               —               —           

Cancelation of debt

      2,401                  —               —               439        

Reduction in NOL due to 382 Limitation

      4,518                  —               —               —           

Change in valuation allowance

      16,834                  35             38              42        
  

 

 

          

 

 

     

 

 

     

 

 

  

Effective Rate

      —  %                —  %           —  %           (171)%   
  

 

 

          

 

 

     

 

 

     

 

 

  
Components of Net Deferred Tax Asset

The components of the net deferred tax asset as of December 31, 2012, 2011 and 2010, are as follows:

 

     2012      2011      2010  

Deferred federal income tax asset:

         

Losses and loss adjustments expenses

    $ 2,832       $ 4,097       $ 5,906   

Net operating loss carryforward

      2,088,461         5,013         43   

Accruals and reserves

      18,276         —           —     

Accrual class action settlement

      —           1,400         1,400   
  

 

 

     

 

 

     

 

 

  

Total deferred federal income tax asset

      2,109,569         10,510         7,349   

Deferred federal income tax liabilities:

         

Net unrealized gains on investments

      1,946         1,774         2,764   

Total deferred federal income tax liabilities

      1,946         1,774         2,764   

Less: Valuation allowance

      2,107,623         8,736         4,585   
  

 

 

     

 

 

     

 

 

  

Net deferred federal income tax asset

    $ —         $ —         $ —