Note 6 - Income Taxes

6 Months Ended

Jun. 30, 2017

Notes to Financial Statements

Income Tax Disclosure [Text Block]

( 6 ) INCOME TAXES

Our estimated annual effective tax rate, adjusted for discrete tax items, is applied to interim periods’ pretax income (loss). Our estimated annual effective tax rate includes the recognition of a valuation allowance on our deferred tax assets. The tax effect of this recognition is a discrete item for the

second

quarter of

2017

of

$3.9

million.

In previous years, we determined to repatriate all future foreign earnings and

$240.0

million of prior earnings of certain of our non-U.S. subsidiaries, thereby reducing our total permanently reinvested earnings. The change in our foreign repatriation strategy resulted in a non-cash tax charge of approximately

$84.0

million. We have

not

provided for U.S. deferred taxes on the permanently reinvested earnings of approximately

$553.0

million at

June 30, 2017.

The projected cash flows of our foreign operations is

not

sufficient to cover the permanently reinvested earnings without selling assets. We do

not

intend to liquidate any foreign assets to generate cash to remit to the U.S. parent.

If remaining permanently reinvested earnings were repatriated, the incremental U.S. tax would be approximately

35%

based on current tax law. In addition, as of

June 30, 2017,

we had approximately

$8.6

million of cash held by our foreign subsidiaries which would be subject to U.S. tax upon repatriation.