2004 Notes to Consolidated Financial Statements (Dollar and Share Amounts in Thousands except Per Share Information and as Otherwise Noted)  Earnings before income taxes were derived from the following sources:  7  Income Taxes 2004 2003 2002 Domestic $ 204,045 134,567 119,977 Foreign 4,291 1,769 1,230 208,336 136,336 121,207 2004:  Current  Deferred  Total  Federal  $ 66,732  (463) 66,269  State  9,709  (118) 9,591  Foreign  1,959  (472) 1,487  $ 78,400  (1,053) 77,347  2003:  Current Deferred Total Federal $  41,767 3,004 44,771 State 6,313 454 6,767 Foreign 633 45 678 $  48,713 3,503 52,216 2002:  Current Deferred Total Federal $  38,953 949 39,902 State 5,870 146 6,016 Foreign 452 11 463 $  45,275 1,106 46,381 2004 2003 2002 Federal income tax expense at the “expected” rate of 35%  $ 72,918 47,718 42,422 Increase (decrease) attributed to:  State income taxes, net of federal benefit  6,234 4,399 3,910 Resolution of state tax matters  (1,821) — — Other, net  16 99 49 Total income tax expense  $ 77,347 52,216 46,381 Income tax expense in the accompanying consolidated financial statements differs from the expected  expense as follows: As of December 31, 2004, the Company has approximately $7,400 of basis differences in subsidiaries  outside of the United States that are considered to be reinvested indefinitely. No deferred tax liability has  been provided for such differences.  Components of income tax expense (benefit) are as follows:  2004 ANNUAL REPORT – PAGE 29 