Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

Income Tax Disclosure [Abstract]

Components of Earnings Before Income Taxes

The components of earnings before income taxes and the income taxes paid consisted of the following (in millions):

For the Years Ended December 31,	2014		2013		2012
United States operations	$	395.6	$	400.7	$	409.9
Foreign operations		548.3		580.4		580.2
Total	$	943.9	$	981.1	$	990.1

Provision for Income Taxes and Income Taxes Paid

The provision for income taxes consisted of (in millions):

Current:
Federal	$	177.6		$	199.0		$	179.8
State		16.3			20.6			13.8
Foreign		115.2			128.5			108.4
		309.1			348.1			302.0
Deferred:
Federal		(56.9	)		(87.7	)		(58.8	)
State		(6.6	)		(8.5	)		0.7
Foreign		(20.7	)		(30.0	)		(6.7	)
		(84.2	)		(126.2	)		(64.8	)
Provision for income taxes	$	224.9		$	221.9		$	237.2
Income taxes paid	$	340.1		$	272.3		$	227.6

Reconciliation of U.S. Statutory Income Tax Rate to Our Effective Tax Rate

A reconciliation of the U.S. statutory income tax rate to our effective tax rate is as follows:

For the Years Ended December 31,	2014			2013			2012
U.S. statutory income tax rate		35.0	%		35.0	%		35.0	%
State taxes, net of federal deduction		0.7			0.8			1.0
Tax impact of foreign operations, including foreign tax credits		(11.3	)		(12.2	)		(10.4	)
Tax impact of certain significant transactions		1.4			1.6			(3.5	)
Tax benefit relating to U.S. manufacturer’s deduction and export sales		(1.9	)		(1.8	)		(1.9	)
R&D credit		(0.2	)		(0.6	)		–
Goodwill impairment		–			–			3.4
Other		0.1			(0.2	)		0.4
Effective income tax rate		23.8	%		22.6	%		24.0	%

Components of Deferred Taxes

The components of deferred taxes consisted of the following (in millions):

As of December, 31	2014			2013
Deferred tax assets:
Inventory	$	275.1		$	271.1
Net operating loss carryover		116.9			26.4
Tax credit carryover		185.5			187.1
Capital loss carryover		7.4			7.8
Accrued liabilities		106.7			72.0
Share-based compensation		59.9			74.6
Unremitted earnings of foreign subsidiaries		32.3			25.6
Other		50.3			11.2
Total deferred tax assets		834.1			675.8
Less: Valuation allowances		(122.8	)		(42.7	)
Total deferred tax assets after valuation		711.3			633.1
Deferred tax liabilities:
Fixed assets	$	(104.3	)	$	(97.7	)
Intangible assets		(95.9	)		(106.4	)
Other		–			(1.2	)
Total deferred tax liabilities		(200.2	)		(205.3	)
Total net deferred tax assets	$	511.1		$	427.8

Tabular Reconciliation of Total Amounts of Unrecognized Tax Benefits

The following is a tabular reconciliation of the total amounts of unrecognized tax benefits (in millions):

For the Years Ended December 31,	2014			2013			2012
Balance at January 1	$	304.3		$	285.5		$	158.4
Increases related to prior periods		0.9			16.5			118.7
Decreases related to prior periods		(3.8	)		(17.3	)		(8.9	)
Increases related to current period		17.3			22.5			19.1
Decreases related to settlements with taxing authorities		(3.0	)		(2.9	)		(0.6	)
Decreases related to lapse of statute of limitations		(1.7	)		–			(1.2	)
Balance at December 31	$	314.0		$	304.3		$	285.5
Amounts impacting effective tax rate, if recognized balance at December 31	$	203.0		$	186.3		$	159.0