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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2023

Schedule of Income (Loss) Before Income Taxes And Minority Interests

The Company's geographic sources of income before income taxes are as follows (in millions):


	Year ended December 31,
	2023		2022		2021
United States	$	2,222.2	$	1,979.8	$	873.2
Foreign	313.6		382.4		284.6
Income before income taxes	$	2,535.8	$	2,362.2	$	1,157.8

Schedule of Provision (Benefit) For Income Taxes

The Company's provision for income taxes is as follows (in millions):


	Year ended December 31,
	2023		2022		2021
Current:
Federal	$	372.7	$	331.9	$	8.0
State and local	21.6		31.8		4.8
Foreign	76.9		73.8		43.3
	471.2		437.5		56.1
Deferred:
Federal	(107.9)		(36.9)		89.2
State and local	13.2		25.7		7.8
Foreign	(26.3)		32.1		(6.5)
	(121.0)		20.9		90.5
Total provision	$	350.2	$	458.4	$	146.6

Schedule of Reconciliation Of The U.S. Federal Statutory Income Tax Rate

A reconciliation of the U.S. federal statutory income tax rate to the Company's effective income tax rate is as follows:


	Year ended December 31,
	2023		2022		2021
U.S. federal statutory rate	21.0	%	21.0	%	21.0	%
Increase (decrease) resulting from:
State and local taxes, net of federal tax benefit	0.7		1.7		1.4

Impact of foreign operations	0.3		1.7		(2.0)

Foreign derived intangible income benefit	(6.8)		(7.4)		(7.8)


Nondeductible goodwill	—		3.1		—

Change in valuation allowance and related effects (1)	0.5		(0.1)		(0.4)


Share-based compensation costs	(0.2)		(0.5)		(0.1)
U.S. federal R&D credit	(0.4)		(0.2)		(0.4)
Non-deductible officer compensation	0.3		0.3		0.4
Impact of audit settlement	(1.8)		—		—
Other (2)	0.2		(0.2)		0.6
Total	13.8	%	19.4	%	12.7	%

_______________________

(1)For the year ended December 31, 2023, this included a benefit of $13.7 million, or 0.5% related to a decrease in the valuation allowance for the expiration of Japan net operating losses ("NOLs"), partially netted with an offsetting expense of $15.3 million or 0.6% related to the expiration of those same Japan NOLs. For the year ended December 31, 2022, this included a benefit of $55.6 million, or 2.4% related to a decrease in the valuation allowance for the expiration of Japan NOLs, partially netted with an offsetting expense of $54.3 million, or 2.3% related to the expiration of those same Japan NOLs. For the year ended December 31, 2021, this included a benefit of $26.3 million, or 2.2% related to a decrease in the valuation allowance for the expiration of Japan NOLs, partially netted with an offsetting expense of $22.6 million, or 1.9% related to the expiration of those same Japan NOLs.

(2)For the year ended December 31, 2021, this included an expense of $8.5 million, or 0.7%, related to an election to waive Base Erosion Anti-Abuse Tax ("BEAT") deductions for all U.S. federal tax purposes for the 2021 tax year.

Schedule of Tax Effects Of Temporary Differences

The tax effects of temporary differences in the recognition of income and expense for tax and financial reporting purposes that give rise to significant portions of the net deferred tax asset (liability) are as follows (in millions):


	As of December 31,
	2023		2022
NOL and tax credit carryforwards	$	227.6	$	221.6
163 (j) interest expense carryforward	4.6		5.1
Lease liabilities	59.7		65.0
ROU asset	(58.9)		(60.9)
Tax-deductible goodwill and amortizable intangibles	(32.2)		(35.9)
Capitalization of research and development expenses	419.9		311.4
Reserves and accruals	60.2		79.1
Property, plant and equipment	(165.1)		(156.3)
Inventories	134.2		78.3
Undistributed earnings of foreign subsidiaries	(67.7)		(64.2)
Share-based compensation	9.7		7.5
Pension	5.8		7.5
Convertible Debt	108.1		27.0
Other	6.5		9.8
Deferred tax assets and liabilities before valuation allowance	712.4		495.0
Valuation allowance	(150.3)		(152.4)
Net deferred tax asset	$	562.1	$	342.6

Schedule of Activity For Unrecognized Gross Tax Benefits

The activity for unrecognized gross tax benefits is as follows (in millions):


	2023		2022		2021
Balance at beginning of year	$	136.8	$	137.2	$	151.0
Acquired balances	—		—		9.3
Additions for tax benefits related to the current year	3.4		3.3		3.1
Additions for tax benefits of prior years	0.7		0.5		—
Reductions for tax benefits of prior years	(48.0)		(0.3)		(19.7)
Lapse of statute	(9.9)		(3.8)		(2.7)
Settlements	(15.3)		(0.1)		(3.8)

Balance at end of year	$	67.7	$	136.8	$	137.2