Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

Schedule of domestic and foreign components of income before taxes

Domestic and foreign components of income before income taxes are shown below:



	Year Ended December 31,
(In millions)	2014		2013		2012
Domestic	$	353.2	$	150.7	$	125.5
Foreign	707.7		563.3		470.9
Income before income taxes attributable to FMC Technologies, Inc.	$	1,060.9	$	714.0	$	596.4

Provision for income taxes

The provision for income taxes consisted of:



	Year Ended December 31,
(In millions)	2014			2013			2012
Current:
Federal	$	139.6		$	77.8		$	41.5
State	11.7			5.6			2.9
Foreign	227.8			149.6			131.8
Total current	379.1			233.0			176.2
Deferred:
Increase in the valuation allowance for deferred tax assets	34.1			0.5			0.5
Decrease of deferred tax liability for change in tax rates	(2.3		)	(4.3		)	(1.3		)
Other deferred tax (benefit) expense	(49.9		)	(16.6		)	(9.0		)
Total deferred	(18.1		)	(20.4		)	(9.8		)
Provision for income taxes	$	361.0		$	212.6		$	166.4

Deferred tax assets and liabilities

Significant components of our deferred tax assets and liabilities were as follows:



	December 31,
(In millions)	2014			2013
Deferred tax assets attributable to:
Accrued expenses	$	58.0		$	56.6
Non deductible interest	29.2			—
Foreign tax credit carryforwards	29.3			14.0
Accrued pension and other post-retirement benefits	91.8			26.5
Stock-based compensation	28.9			25.3
Net operating loss carryforwards	48.7			47.8
Inventories	31.7			25.9
Norwegian correction tax	50.4			61.9
Foreign exchange	40.2			3.7
Deferred tax assets	408.2			261.7
Valuation allowance	(38.9		)	(4.7		)
Deferred tax assets, net of valuation allowance	369.3			257.0
Deferred tax liabilities attributable to:
Revenue in excess of billings on contracts accounted for under the percentage of completion method	105.2			137.0
U.S. tax on foreign subsidiaries’ undistributed earnings not indefinitely reinvested	52.5			43.5
Property, plant and equipment, goodwill and other assets	142.8			137.2
Deferred tax liabilities	300.5			317.7
Net deferred tax assets (liabilities)	$	68.8		$	(60.7	)

Unrecognized tax benefits and associated interest and penalties

The following table presents a summary of changes in our unrecognized tax benefits and associated interest and penalties:



(In millions)	Federal, State and Foreign Tax			Accrued Interest and Penalties			Total Gross Unrecognized Income Tax Benefits
Balance at December 31, 2011	$	39.9		$	6.2		$	46.1
Additions for tax positions related to prior years	(0.1		)	2.1			2.0
Reductions for tax positions due to settlements	(9.3		)	(1.9		)	(11.2		)
Balance at December 31, 2012	$	30.5		$	6.4		$	36.9
Additions for tax positions related to prior years	3.1			0.4			3.5
Additions for tax positions related to current year	3.5			0.3			3.8
Balance at December 31, 2013	$	37.1		$	7.1		$	44.2
Additions for tax positions related to prior years	0.6			0.4			1.0
Reductions for tax positions due to settlements	(1.4		)	(0.3		)	(1.7		)
Balance at December 31, 2014	$	36.3		$	7.2		$	43.5

Reconciliation of effective tax rate

The effective income tax rate was different from the statutory U.S. federal income tax rate due to the following:



	Year Ended December 31,
	2014		2013		2012
Statutory U.S. federal income tax rate	35	%	35	%	35	%
Net difference resulting from:
Foreign earnings subject to different tax rates	(8	)	(13	)	(12	)
Foreign earnings subject to U.S. tax	2		2		4
Non deductible Multi Phase Meters earn-out adjustments	—		1		2
Settlement of foreign audits	—		1		—
Foreign withholding taxes	2		3		—
Change in valuation allowance	3		—		—
Other	—		1		(1	)
Effective income tax rate	34	%	30	%	28	%

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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