Income Taxes

12 Months Ended

Dec. 31, 2014

11. Income Taxes

The components of income tax (provision) benefit for the years ended December 31, 2014, 2013 and 2012 are comprised of the following:



	2014			2013			2012
Current:
Federal	$	(51	)	$	231		$	(5,210	)
State	(196		)	(264		)	(253		)
Foreign	—			—			(10		)
Deferred:
State	9			36			(49		)
	$	(238	)	$	3		$	(5,522	)

Deferred income taxes represent the tax effect of the temporary differences between the book and tax basis of assets and liabilities. Deferred tax assets (liabilities) include the following as of December 31, 2014 and 2013:



	2014			2013
Impairment of Real Estate	$	2,466		$	5,185
Foreign Net Operating Loss Carryforward	585			1,312
Valuation Allowance	(4,224		)	(5,357		)
Other	1,251			696
Total Deferred Tax Assets, Net of Allowance	$	78		$	1,836
Straight-line Rent	$	(90	)	$	(76	)
Fixed Assets	—			(1,771		)
Other	(112		)	(122		)
Total Deferred Tax Liabilities	$	(202	)	$	(1,969	)
Total Net Deferred Tax Liabilities	$	(124	)	$	(133	)

A valuation allowance is recorded if we believe it is more likely than not that all or some portion of our deferred tax assets will not be realized. We do not have projections of future taxable income or other sources of taxable income in the taxable REIT subsidiaries significant enough to allow us to believe it is more likely than not that we will realize our deferred tax assets. Therefore, we have recorded a valuation allowance against our deferred tax assets. An increase or decrease in the valuation allowance that results from a change in circumstances, and which causes a change in our judgment about the realizability of the related deferred tax assets, is included in the current tax provision.

The income tax (provision) benefit pertaining to income (loss) from continuing operations and gain on sale of real estate of the taxable REIT subsidiaries differs from the amounts computed by applying the applicable federal statutory rate as follows for the years ended December 31, 2014, 2013 and 2012:



	2014			2013			2012
Tax (Provision) Benefit at Federal Rate Related to Continuing Operations	$	(532	)	$	286		$	557
State Tax Provision, Net of Federal Benefit	(214		)	(236		)	(244		)
Non-deductible Permanent Items, Net	1			21			32
IRS Audit Adjustment and Accrued Interest	—			58			(5,523		)
Change in Valuation Allowance	1,133			(388		)	(166		)
Foreign Taxes, Net	—			—			(10		)
Other	(626		)	262			(168		)
Net Income Tax (Provision) Benefit	$	(238	)	$	3		$	(5,522	)

We evaluate tax positions taken in the financial statements on a quarterly basis under the interpretation for accounting for uncertainty in income taxes. As a result of this evaluation, we may recognize a tax benefit from an uncertain tax position only if it is "more-likely-than-not" that the tax position will be sustained on examination by taxing authorities. As of December 31, 2014, we do not have any unrecognized tax benefits.

We file income tax returns in the U.S., and various states and foreign jurisdictions. In general, the statutes of limitations for income tax returns remain open for the years 2011 through 2014.

IRS Tax Refund

On August 24, 2009, we received a private letter ruling from the IRS granting favorable loss treatment under Sections 331 and 336 of the Code on the tax liquidation of one of our former taxable REIT subsidiaries. On November 6, 2009, legislation was signed that allowed businesses with net operating losses for 2008 or 2009 to carry back those losses for up to five years. As a result, we received a refund from the IRS of $40,418 in the fourth quarter of 2009 (the "Refund") in connection with this tax liquidation. The IRS disagreed with certain of the property valuations we obtained from an independent valuation expert in support of our fair value of the liquidated taxable REIT subsidiary and our claim for the Refund. During the year ended December 31, 2012, we agreed to an adjustment, which resulted in us owing approximately $5,300 in taxes and accrued interest. During the year ended December 31, 2012, the Operating Partnership recorded a charge for the agreed-upon adjustment which was reflected as a component of income tax expense.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References+ Details

FIRST INDUSTRIAL LP 10-K