Note 8 - Income Taxes

9 Months Ended

Sep. 30, 2016

Notes to Financial Statements

Income Tax Disclosure [Text Block]

Note 8. Income Taxes

The Company’s effective tax rate for the three month and nine month periods ended September 30, 2016 was 39.2% and 37.7%, respectively, and 38.5% and 39.1% for the three month and nine month periods ended September 30, 2015, respectively.

The Company is subject to federal income taxes in the U.S. and various state and foreign jurisdictions. Tax statutes and regulations within each jurisdiction are subject to interpretation and require the application of significant judgment. The Company’s 2013 through 2015 tax years remain subject to examination by the Internal Revenue Service for federal tax purposes, in addition to the Company’s 2012 amended tax return. Certain significant state and foreign tax jurisdictions also remain open under the statute of limitations and are subject to examination for the tax years from 2012 to 2015.

The Company’s total liability for unrecognized tax benefits as of September 30, 2016 was $1.2 million. Included in the balance as of September 30, 2016 was $1.0 million of tax positions that, if recognized, would have a favorable impact on the Company’s effective tax rate. The Company believes it is reasonably possible that, during the next 12 months, the Company’s liability for uncertain tax benefits may decrease by approximately $0.4 million.

The Company’s policy is not to recognize accrued interest and penalties related to unrecognized tax benefits as a component of tax expense. The Company has made no provision for deferred U.S. income taxes or additional foreign taxes on future unremitted earnings of its controlled foreign subsidiaries because the Company considers these earnings to be permanently invested.