The significant components of the net income tax asset consist of the following at December 31 (dollars in thousands): In assessing the ability to realize a deferred tax asset, management considers whether it is more likely than not that some  portion or the entire deferred tax asset will not be realized. The ultimate realization of deferred tax assets is dependent upon the  generation of future taxable income during the periods in which those temporary differences become deductible. Management  considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in  making this assessment. The net operating loss carryforwards were generated by NNN’s taxable REIT subsidiaries. The net  operating loss carryforwards begin to expire in 2028. Based upon the level of historical taxable income and projections for  future taxable income management believes it is more likely than not that NNN will realize all of the benefits of these  deductible differences that existed as of December 31, 2013 and 2012.  As noted in Note 1, during the year ended December 31, 2012, NNN identified certain immaterial errors related to deferred tax  assets and the related valuation allowance. NNN decreased deferred tax assets and the related valuation allowance by  $10,350,000 each to correct a gross-up error and reversed its valuation allowance by $6,493,000 to reflect an overstatement of  its valuation allowance recorded in the years ended December 31, 2010 and 2009.  Furthermore, NNN determined in the year ended December 31, 2012 that its available sources of income supported realizability  of all of its gross deferred tax assets. In 2012, NNN reversed the remaining valuation allowance and recorded an income tax  benefit of $1,178,000.  The decrease in the valuation allowance for the year ended December 31, 2012 was $18,021,000. There was no valuation  allowance as of December 31, 2013 or 2012, respectively.  68 2013 2012 Deferred tax assets: Cost basis $ 994 $ 1,118 Deferred income 155 247 Reserves 4,728 3,735 Credits 393 217 Excess interest expense carryforward 2,706 4,508 Net operating loss carryforward 5,212 5,829 14,188 15,654 Valuation allowance — — Total deferred tax assets 14,188 15,654 Deferred tax liabilities: Built-in gain (2,163) (2,924) Depreciation (618) (756) Other (779) (546) Total deferred tax liabilities (3,560) (4,226) Net deferred tax asset $ 10,628 $ 11,428