QUANTA SERVICES INC, QUANTA SERVICES MANAGEMENT ...

QUANTA SERVICES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The net deferred income tax assets and liabilities are comprised of the following (in thousands):
December 31,
2011 2010
Current deferred income taxes:
Assets ..................................................... $ 51,373 $ 46,883
Liabilities .................................................. (17,831) (23,307)
33,542 23,576
Non-current deferred income taxes:
Assets ..................................................... 78,630 63,201
Liabilities .................................................. (312,274) (275,401)
(233,644) (212,200)
Total net deferred income tax liabilities ......................... $(200,102) $(188,624)
The valuation allowance for deferred income tax assets at December 31, 2011, 2010, and 2009 was $8.8
million, $11.4 million, and $8.6 million, respectively. These valuation allowances relate to state net operating
loss carryforwards, a deferred tax asset for goodwill and foreign tax credit carryforwards. The net change in the
total valuation allowance for each of the years ended December 31, 2011, 2010, and 2009 was a decrease of $2.6
million, an increase of $2.8 million and a decrease of $0.6 million, respectively. The valuation allowance was
established primarily as a result of uncertainty in Quanta’s outlook as to future taxable income in particular tax
jurisdictions. Quanta believes it is more likely than not that it will realize the benefit of its deferred tax assets, net
of existing valuation allowances.
At December 31, 2011, Quanta had state and foreign net operating loss carryforwards, the tax effect of
which is approximately $15.6 million. These carryforwards will expire as follows: 2012, $0.3 million; 2013, $0.4
million; 2014, $0.8 million; 2015, $0.3 million; 2016, $0.3 million and $13.5 million thereafter. A valuation
allowance of $6.4 million has been recorded against certain state net operating loss carryforwards.
Through December 31, 2011, Quanta has not provided U.S. income taxes on unremitted foreign earnings
because such earnings are intended to be indefinitely reinvested outside the U.S. It is not practicable to determine
the amount of any additional U.S. tax liability that may result if Quanta decides to no longer indefinitely reinvest
foreign earnings outside the U.S.
A reconciliation of unrecognized tax benefit balances is as follows (in thousands):
2011
December 31,
2010 2009
Balance at beginning of year .............................. $50,632 $ 45,201 $ 59,190
Additions based on tax positions related to the current year ...... 10,133 10,602 10,078
Additions for tax positions of prior years .................... 131 5,183 633
Additions attributable to acquisitions of businesses ............ — — 1,904
Reductions for tax positions of prior years ................... — — (1,132)
Settlements ............................................
Reductions resulting from a lapse of the applicable statutes of
(4,877) (93) (447)
limitations .......................................... (8,640) (10,261) (25,025)
Balance at end of year ................................... $47,379 $ 50,632 $ 45,201
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