INCOME TAXES

9 Months Ended

Sep. 30, 2023

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

The following table summarizes our income tax expense and effective tax rate.

	Three Months Ended						Nine Months Ended
	September 30, 2023			October 1, 2022			September 30, 2023			October 1, 2022
Income tax expense	$	29.9		$	16.4		$	80.6		$	59.9
Effective tax rate	21.1		%	13.7		%	20.0		%	19.0		%

The effective tax rate (ETR) for the three months ended September 30, 2023 was higher than the prior year as ITT recognized benefits of $1.7 from a valuation allowance reversal on deferred tax assets in Italy in the prior year. For the nine months ended September 30, 2023, the ETR was relatively consistent with that of the prior year, and included benefits of $16.5 from valuation allowance reversals on deferred tax assets in Germany and $4.7 from filing an amended 2017 consolidated federal tax return. These benefits were partially offset by an expense of $14.3 relating to an Italian tax audit settlement covering tax years 2016-2022.

The Company operates in various tax jurisdictions and is subject to examination by tax authorities in these jurisdictions. The Company is currently under examination in several jurisdictions including China, Czechia, Germany, India, Italy, and the U.S. The estimated tax liability calculation for unrecognized tax benefits considers uncertainties in the application of complex tax laws and regulations in various tax jurisdictions. Due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from the current estimate of the unrecognized tax benefit. Over the next 12 months, the net amount of the tax liability for unrecognized tax benefits in foreign and domestic jurisdictions could decrease by approximately $0.7 due to changes in audit status, expiration of statutes of limitations and other events.