16. Income Taxes

Income taxes relating to income from continuing operations consisted of the following:


	Year Ended December 31,
	2016		2015		2014
Current:
Federal	$	(47.2)	$	61.8	$	51.2
State and local		4.7		11.5		7.9
Foreign		41.0		40.1		43.5
Total current	$	(1.5)	$	113.4	$	102.6
Deferred:
Federal		140.6		40.1		42.9
State and local		22.3		8.4		9.3
Foreign		(0.7)		(3.9)		(1.7)
Total deferred	$	162.2	$	44.6	$	50.5
Income taxes relating to continuing operations	$	160.7	$	158.0	$	153.1

Income taxes relating to income from continuing operations varied from the U.S. federal statutory income tax rate due to the following:


	Year Ended December 31,
	2016		2015		2014
Income taxes relating to continuing operations at federal statutory rate of 35%	$	177.8	$	172.2	$	160.3
State and local income taxes, net of federal taxes		14.7		13.3		11.0
Non-U.S. income taxed at other rates		(26.8)		(27.4)		(17.7)
Other		(5.0)		(0.1)		(0.5)
Income taxes relating to continuing operations	$	160.7	$	158.0	$	153.1

The components of deferred tax assets and liabilities as of December 31, 2016 and 2015 were as follows:


	2016		2015
Deferred Tax Assets
Accrued liabilities	$	71.4	$	67.5
Net operating loss carryforwards		32.4		17.9
Other		18.7		26.2
Total deferred tax assets		122.5		111.6
Valuation allowance		(17.2)		(17.3)
Net deferred tax assets		105.3		94.3
Deferred Tax Liabilities
Depreciation and amortization		(210.9)		(198.1)
Partnership investments		(448.1)		(285.5)
Convertible notes		(5.0)		(7.5)
Other		(5.9)		(6.1)
Total deferred tax liabilities		(669.9)		(497.2)
Net deferred tax liabilities	$	(564.6)	$	(402.9)

We do not provide for U.S. taxes relating to undistributed earnings or losses of our non-U.S. subsidiaries. Income from continuing operations before income taxes of non-U.S. subsidiaries (which subsidiaries are predominately in the U.K.) was $191.4 million, $182.5 million, and $170.6 million during 2016, 2015, and 2014, respectively. It is our belief that such earnings will be indefinitely reinvested in the companies that produced them. As of December 31, 2016, we have not provided U.S. federal income taxes on a total temporary difference of $816.5 million related to the excess of financial reporting basis over tax basis in the non-U.S. subsidiaries.

As a result of our acquisition of the remaining ownership interests of Premier Truck Group in April 2016, bringing our total ownership interest to 100%, the partnership entity was liquidated, thereby yielding an adjustment to the tax basis of this investment. The result was an elimination of $5.1 million of deferred tax liabilities, which reduced income tax expense by the same amount in the current year.

As of December 31, 2016, we have $240.1 million of state net operating loss carryforwards in the U.S. that expire at various dates beginning in 2017 through 2036, U.S. and Puerto Rico federal and state credit carryforwards of $8.5 million that will not expire, U.K. capital loss carryforwards of $4.7 million that will not expire, German net operating loss carryforwards of $20.1 million that will not expire, Australian net operating loss carryforwards of $22.1 million that will not expire, Canadian net operating loss carryforwards of $1.7 million that will not expire, and Italian net operating loss carryforwards of $0.1 million that will not expire. The Company generated $174.2 million of state net operating loss carryforwards in the U.S. in 2016.

A valuation allowance of $2.6 million has been recorded against the state net operating loss carryforwards in the U.S. and a valuation allowance of $0.3 million has been recorded against the state credit carryforwards in the U.S. as of December 31, 2016. A valuation allowance of $7.3 million has been recorded against German net operating losses and other deferred tax assets as of December 31, 2016. A valuation allowance of $6.5 million has been recorded against U.K. deferred tax assets related to buildings as of December 31, 2016. A valuation allowance of $0.4 million has been recorded against Canadian net operating losses as of December 31, 2016. A valuation allowance of $0.1 million has been recorded against Australian capital losses as of December 31, 2016.

Generally accepted accounting principles relating to uncertain income tax positions prescribe a minimum recognition threshold a tax position is required to meet before being recognized, and provides guidance on the derecognition, measurement, classification, and disclosure relating to income taxes. The movement in uncertain tax positions for the years ended December 31, 2016, 2015, and 2014 were as follows:


	2016		2015		2014
Uncertain tax positions — January 1	$	12.8	$	13.1	$	14.0
Gross increase — tax position in prior periods		0.2		0.2		0.2
Gross decrease — tax position in prior periods		(0.3)		—		(0.6)
Gross increase — current period tax position		—		—		0.1
Settlements		(7.8)		—		—
Lapse in statute of limitations		—		—		—
Foreign exchange		(1.5)		(0.5)		(0.6)
Uncertain tax positions — December 31	$	3.4	$	12.8	$	13.1

We have elected to include interest and penalties in our income tax expense. The total interest and penalties included within uncertain tax positions at December 31, 2016 was $2.0 million. We do not expect a significant change to the amount of uncertain tax positions within the next twelve months. Our U.S. federal returns remain open to examination for 2013 through 2015 and various non-U.S. and U.S. state jurisdictions are open for periods ranging from 2009 through 2015. The portion of the total amount of uncertain tax positions as of December 31, 2016 that would, if recognized, impact the effective tax rate was $3.4 million.

We have classified our tax reserves as a long‑term obligation on the basis that management does not expect to make payments relating to those reserves within the next twelve months.