Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Components of Earnings (Loss) Before Income Taxes

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

	For the Years Ended December 31,
	2019			2018			2017
United States operations	$	(125.9	)	$	(382.8	)	$	(114.0	)
Foreign operations		1,031.7			111.7			578.6
Total	$	905.8		$	(271.1	)	$	464.6

(Benefit)/Provision for Income Taxes and Income Taxes Paid

The (benefit)/provision for income taxes and the income taxes paid consisted of the following (in millions):

Current:
Federal	$	65.5		$	(46.2	)	$	438.5
State		9.8			24.4			2.4
Foreign		237.7			116.6			(13.7	)
		313.0			94.8			427.2
Deferred:
Federal		(90.2	)		37.9			(1,728.5	)
State		(4.2	)		(8.8	)		(95.5	)
Foreign		(444.3	)		(15.7	)		48.0
		(538.7	)		13.4			(1,776.0	)
(Benefit) provision for income taxes	$	(225.7	)	$	108.2		$	(1,348.8	)
Net income taxes paid	$	192.5		$	237.1		$	266.9

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,
	2019				2018				2017
U.S. statutory income tax rate		21.0		%		21.0		%		35.0		%
State taxes, net of federal deduction		0.8				(2.5	)			1.8
Tax impact of foreign operations, including U.S. taxes on international income and foreign tax credits		(10.2	)			54.3				(32.0	)
Change in valuation allowance		1.5				(4.9	)			0.8
Non-deductible expenses		0.4				1.7				2.7
Goodwill impairment		-				(75.2	)			22.5
Tax rate change		0.6				(12.2	)			(24.0	)
Tax benefit relating to foreign derived intangible income and U.S. manufacturer’s deduction		(4.5	)			(0.2	)			(1.7	)
R&D tax credit		(1.2	)			6.0				(1.2	)
Share-based compensation		(0.4	)			0.1				(2.6	)
Net uncertain tax positions, including interest and penalties		1.9				(25.5	)			(17.0	)
U.S. tax reform		0.1				(3.1	)			(273.8	)
Switzerland tax reform and certain restructuring transactions		(34.8	)			-				-
Other		(0.1	)			0.6				(0.8	)
Effective income tax rate		(24.9	)	%		(39.9	)	%		(290.3	)	%

Components of Deferred Taxes

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

	As of December 31,
	2019			2018
Deferred tax assets:
Inventory	$	295.6		$	271.5
Net operating loss carryover		514.4			374.3
Tax credit carryover		33.8			29.2
Capital loss carryover		8.3			7.9
Product liability and litigation		40.4			92.6
Accrued liabilities		45.5			35.3
Share-based compensation		28.6			27.3
Accounts receivable		24.6			15.2
Other		79.0			48.8
Total deferred tax assets		1,070.2			902.1
Less: Valuation allowances		(546.1	)		(390.9	)
Total deferred tax assets after valuation allowances		524.1			511.2
Deferred tax liabilities:
Fixed assets	$	77.6		$	94.4
Intangible assets		772.3			1,301.3
Other		42.9			14.1
Total deferred tax liabilities		892.8			1,409.8
Total net deferred income taxes	$	(368.7	)	$	(898.6	)

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,
	2019			2018			2017
Balance at January 1	$	685.5		$	626.8		$	649.3
Increases related to business combinations		-			4.5			70.2
Increases related to prior periods		24.7			34.6			172.8
Decreases related to prior periods		(35.6	)		(14.4	)		(262.2	)
Increases related to current period		133.2			41.9			24.8
Decreases related to settlements with taxing authorities		(60.2	)		(3.8	)		(21.7	)
Decreases related to lapse of statute of limitations		(5.8	)		(4.1	)		(6.4	)
Balance at December 31	$	741.8		$	685.5		$	626.8
Amounts impacting effective tax rate, if recognized balance at December 31	$	599.2		$	549.1		$	499.6