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Income Taxes
9 Months Ended
Sep. 30, 2015
Income Taxes

5 Income Taxes

The effective tax rate in the third quarter of 2015 was 34.7% compared to 31.9% in the same quarter of 2014. Discrete tax items, net had a favorable impact of 0.4%. In the third quarter of 2014, discrete tax items, net decreased the tax rate by 0.2%.

The effective tax rate in the first nine months of 2015 was 33.9% compared to 30.8% for the first nine months of 2014. In the first nine months of 2015, the net impact of discrete tax items caused a 0.6% decrease to the effective tax rate. The net impact of discrete tax items in the first nine months of 2014 caused a 0.4% increase to the effective tax rate.

For the three and nine month periods ended September 30, 2015, the tax rate has also been negatively impacted by an unfavorable mix of earnings and tax rates by various jurisdictions compared to the same periods in the prior year.

The Company files income tax returns in the United States federal jurisdiction, various state jurisdictions and foreign jurisdictions. At any given time, the Company is undergoing tax audits in several tax jurisdictions covering multiple years. The Company is no longer subject to income tax examination by the U.S. Federal tax authorities for years prior to 2009. With few exceptions, the Company is no longer subject to income tax examination by U.S. state or local tax authorities or by non-U.S. tax authorities for years before 2007.

As of September 30, 2015 the Company is not aware of any proposed income tax adjustments resulting from tax examinations that would have a material impact on the Company’s condensed consolidated financial statements. The conclusion of such audits could result in additional increases or decreases to unrecognized tax benefits in some future period or periods.

During the third quarter of 2015, the Company recorded a net decrease of $0.6 million to income tax reserves for unrecognized tax benefits based on tax positions related to the current year, including accruing additional interest related to unrecognized tax benefits of prior years. During the quarter, the Company recorded a net decrease of $1.9 million to income tax reserves for unrecognized tax benefits of prior years due to the lapse of the applicable statute of limitations. Of the total unrecognized tax benefits of $25.0 million recorded at September 30, 2015, $6.6 million is classified as current tax payable and $18.4 million is classified as non-current tax payable on the Condensed Consolidated Balance Sheet.