Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

v2.4.1.9
Income Taxes (Tables)
 12 Months Ended
Dec. 31, 2014
Income Tax Disclosure [Abstract]  
Schedule of differences between taxable income reported on income tax returns and net income as reported on consolidated statements of operations
The differences between taxable income reported on our income tax returns (estimated 2014 and actual 2013 and 2012) and net income as reported on our consolidated statements of operations are set forth below (in thousands):
 
 
For the Years Ended December 31,
 
 
2014
 
2013
 
2012
 
 
 (Estimated)
 
 
 
 
COPLP consolidated net income
 
$
45,206

 
$
101,544

 
$
20,341

Adjustments:
 
 
 
 
 
 
Rental revenue recognition
 
(3,932
)
 
1,303

 
(10,794
)
Compensation expense recognition
 
1,912

 
8,987

 
(2,669
)
Operating expense recognition
 
(2,260
)
 
(1,663
)
 
1,158

Gain on sales of properties
 
(1,404
)
 
(50,860
)
 
(74,858
)
Impairment losses
 
1,367

 
32,047

 
66,910

Loss on interest rate derivatives
 
—

 
—

 
(29,805
)
Gains from non-real estate investments
 
405

 
—

 
7,854

Income from service operations
 
(391
)
 
1,650

 
1,500

Income tax expense
 
310

 
1,978

 
381

Depreciation and amortization
 
41,500

 
20,834

 
24,804

Interest expense
 
920

 
2,057

 
3,978

Income from unconsolidated entities
 
(187
)
 
3,148

 
(725
)
COPLP consolidated noncontrolling interests
 
(3,285
)
 
(7,837
)
 
(636
)
Other
 
2,346

 
1,529

 
(70
)
COPLP consolidated taxable income
 
$
82,507

 
$
114,717

 
$
7,369

Noncontrolling interests, other
 
(3,247
)
 
(4,061
)
 
(622
)
Other
 
—

 
—

 
741

COPT consolidated taxable income
 
$
79,260

 
$
110,656

 
$
7,488

Schedule of characterization of dividends declared on common and preferred shares
The characterization of dividends declared on COPT’s common and preferred shares during each of the last three years was as follows:
 
 
Common Shares
 
Preferred Shares
 
 
For the Years Ended December 31,
 
For the Years Ended December 31,
 
 
2014
 
2013
 
2012
 
2014
 
2013
 
2012
Ordinary income
 
64.5
%
 
71.8
%
 
33.2
%
 
90.9
%
 
76.2
%
 
100.0
%
Long-term capital gain
 
6.5
%
 
22.4
%
 
0.0
%
 
9.1
%
 
23.8
%
 
0.0
%
Return of capital
 
29.0
%
 
5.8
%
 
66.8
%
 
0.0
%
 
0.0
%
 
0.0
%
Components of provision for income tax
Our TRS’ provision for income tax consisted of the following expenses (in thousands):
 
 
For the Years Ended December 31,
 
 
2014
 
2013
 
2012
Deferred
 
 
 
 
 
 
Federal
 
$
258

 
$
1,742

 
$
312

State
 
52

 
236

 
69

Total income tax expense
 
$
310

 
$
1,978

 
$
381

Schedule of reconciliation of Federal statutory rate to effective tax rate
A reconciliation of our TRS’ Federal statutory rate to the effective tax rate for income tax reported on our statements of operations is set forth below:
 
 
 
For the Years Ended December 31,
 
 
2014
 
2013
 
2012
Income taxes at U.S. statutory rate
 
34.0
 %
 
34.0
 %
 
34.0
%
State and local, net of U.S. Federal tax benefit
 
4.2
 %
 
4.5
 %
 
4.6
%
Increase in deferred tax asset valuation allowance
 
0.0
 %
 
562.9
 %
 
0.0
%
Other
 
(0.4
)%
 
(1.1
)%
 
0.0
%
Effective tax rate
 
37.8
 %
 
600.3
 %
 
38.6
%
Schedule of tax effects of temporary differences and carry forwards in net deferred tax assets
The table below sets forth the tax effects of temporary differences and carry forwards included in the net deferred tax asset of our TRS (in thousands):
 
 
December 31,
 
 
2014
 
2013
Operating loss forward
 
$
5,012

 
$
5,382

Share-based compensation
 
976

 
869

Accrued payroll
 
195

 
221

Property
 
(119
)
 
(105
)
Valuation allowance
 
(2,062
)
 
(2,062
)
Deferred tax asset, net
 
$
4,002

 
$
4,305