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Income Taxes
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9 Months Ended | ||
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Sep. 30, 2011
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| Income Taxes [Abstract] | |||
| Income Taxes |
Provision for income taxes was a benefit of $6.5 million and $22.7 million for the three and nine months ended September 30, 2011, respectively, compared to an expense of $295 thousand and a benefit of $112 thousand for the three and nine months ended September 30, 2010, respectively. In computing its income tax provision, the Company estimates its effective income tax rate for the full year and applies that rate to income earned through the reporting period. During the period ended September 30, 2011, the Company recorded a $6.5 million long term deferred tax asset as a result of the tax impact of asset impairment charges related to tax deductible goodwill and intangibles. This resulted in a net long term deferred tax asset of $18.1 million on the Company's balance sheet as of September 30, 2011, as compared to a net long term deferred tax liability of $4.6 million as of December 31, 2010.
The Company's realization of its deferred tax assets is dependent upon many factors, including, but not limited to, the Company's ability to generate sufficient taxable income. Certain deferred tax liabilities can also be considered as a source of future taxable income including those resulting from the acquisition. In prior years and through September 30, 2010, the Company had deferred tax assets to which a full valuation allowance was applied. Based upon the weight of available evidence, it was more likely than not that some portion or all of the deferred tax assets would not be realized. As a result of a review of the Company's earnings history, existing deferred tax liabilities including those resulting from the First Biomedical acquisition, the Company removed the valuation allowance previously applied against the net deferred tax asset during the year ended December 31, 2010. |