Income Taxes

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

r Provision for income taxes from continuing operations consisted of the following (in millions):

	For the Years Ended December 31,
	2021		2020		2019
Current:
Federal	$	72.0	$	61.7	$	55.9
State	17.0		14.1		14.2
Foreign	13.4		4.8		9.3
Total current	102.4		80.6		79.4
Deferred:
Federal	(2.6)		(0.7)		15.0
State	(1.5)		1.1		3.9
Foreign	(2.2)		7.1		0.8
Total deferred	(6.3)		7.5		19.7
Total provision for income taxes	$	96.1	$	88.1	$	99.1

Income from continuing operations before income taxes was comprised of the following (in millions):

	For the Years Ended December 31,
	2021		2020		2019
Domestic	$	307.8	$	268.4	$	383.2
Foreign	252.3		176.8		124.7
Total	$	560.1	$	445.2	$	507.9

The difference between the income tax provision from continuing operations computed at the statutory federal income tax rate and the financial statement Provision for income taxes is summarized as follows (in millions):

	For the Years Ended December 31,
	2021		2020		2019
Provision at the U.S. statutory rate of 21%	$	117.6	$	93.5	$	106.7
Increase (reduction) in tax expense resulting from:
State income tax, net of federal income tax benefit	12.1		10.8		13.2
Tax credits, net of unrecognized tax benefits	(9.3)		(7.8)		(13.8)
Change in unrecognized tax benefits	0.2		0.2		3.1
Change in valuation allowance	—		7.8		1.9
Foreign taxes at rates other than U.S. statutory rate	(43.6)		(33.6)		(20.7)
Deemed inclusions	7.7		9.2		8.3
Global intangible low-taxed income	18.8		10.3		9.5
Change in rates from the Tax Act & other law changes	0.1		0.7		(0.8)
Excess tax benefits from stock-based compensation	(5.7)		(4.2)		(10.9)
Miscellaneous other	(1.8)		1.2		2.6
Total provision for income taxes	$	96.1	$	88.1	$	99.1

Deferred income taxes reflect the tax consequences on future years of temporary differences between the tax basis of assets and liabilities and their financial reporting basis and depending on the classification of the asset or liability generating the deferred tax. The deferred tax provision for the periods shown represents the effect of changes in the amounts of temporary differences during those periods.

Deferred tax assets (liabilities) were comprised of the following (in millions):

	As of December 31,
	2021		2020
Gross deferred tax assets:
Warranties	$	32.9	$	29.2
Loss carryforwards (foreign, U.S. and state)	28.5		26.8
Post-retirement and pension benefits	15.6		24.8
Inventory reserves	7.1		7.3
Receivables allowance	4.5		3.8
Compensation liabilities	9.5		10.2
Legal reserves	12.1		10.1
Tax credits, net of federal effect	11.5		11.1
Other	9.6		8.0
Total deferred tax assets	131.3		131.3
Valuation allowance	(37.3)		(37.0)
Total deferred tax assets, net of valuation allowance	94.0		94.3
Gross deferred tax liabilities:
Depreciation	(58.7)		(58.7)
Intangibles	(15.5)		(15.2)
Insurance liabilities	(1.4)		(1.0)
Other	(7.1)		(6.2)
Total deferred tax liabilities	(82.7)		(81.1)
Net deferred tax assets	$	11.3	$	13.2

As of December 31, 2021 and 2020, we had $20.3 million and $18.6 million in tax-effected foreign net operating loss carryforwards, respectively. The deferred tax asset valuation allowance relates primarily to the operating loss carryforwards in

European tax jurisdictions. The remainder of the valuation allowance relates to state tax credits.

In assessing whether a deferred tax asset will be realized, we consider whether it is more likely than not that some portion or all of the deferred tax asset will not be realized. We consider the reversal of existing taxable temporary differences, projected future taxable income and tax planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, we believe it is more likely than not we will realize the benefits of these deductible differences, net of the existing valuation allowances, as of December 31, 2021.

No provision was made for income taxes which may become payable upon distribution of our foreign subsidiaries’ earnings. An actual repatriation in the future from our non-U.S. subsidiaries could still be subject to foreign withholding taxes and U.S. state taxes, but we expect any amounts to be immaterial.

We are currently under examination for our U.S. federal income taxes for 2021 and 2020 and are subject to examination by numerous other taxing authorities in the U.S. and foreign jurisdictions. We are generally no longer subject to U.S., state and local or non-U.S. income tax examinations by taxing authorities for years before 2014.