
	Year Ended December 31,
	2020		2019		2018
Current tax expense (benefit):
Federal	$	10,281	$	5,791	$	17,900
State	2,877		5,895		5,980
Foreign	48,754		9,061		(16,008)
	61,912		20,747		7,872
Deferred tax expense (benefit):
Federal	6,209		11,459		1,273
State	(1,488)		(719)		235
Foreign	5,787		38,832		15,298
	10,508		49,572		16,806
Total income tax provision	$	72,420	$	70,319	$	24,678


	December 31,
	2020		2019
Deferred tax assets:
Accrued liabilities and allowances	$	19,799	$	17,850
Tax credit and loss carry-forwards	23,419		19,471
Stock-based compensation	6,476		10,660
Inventory basis differences	13,851		11,306
Deferred revenue	3,230		2,869


Other assets	—		265
Gross deferred tax assets	66,775		62,421
Valuation allowance	(4,399)		(2,787)
Total deferred tax assets, net	62,376		59,634
Deferred tax liabilities:
Intangible assets	(33,739)		(38,209)
Property and equipment	(17,249)		(16,536)
Unremitted earnings of foreign subsidiaries	(13,419)		(13,225)
Other liabilities	(5,467)		(5,225)
Total deferred tax liabilities	(69,874)		(73,195)
Net deferred tax liabilities	$	(7,498)	$	(13,561)

At December 31, 2020, the Company had United States tax net operating loss carry-forwards totaling approximately $42.0 million which expire between 2032 and 2040 and are subject to annual limitation under Section 382 of the Internal Revenue Code. The Company also has various foreign net operating loss carry-forwards totaling approximately $29.3 million, a portion of which expire between 2021 and 2040, and a portion of which have an indefinite carry-forward period.

As of December 31, 2020, the Company has determined that a valuation allowance against its deferred tax assets of $4.4 million is required, primarily related to foreign net operating losses and capital losses carried forward. A review of all available positive and negative evidence is considered, including past and future performance, the market environment in which the Company operates, utilization of tax attributes in the past, length of carry-back and carry-forward periods, and evaluation of potential tax planning strategies, when evaluating the realizability of deferred tax assets. The Company believes that it is more likely than not that the results of future operations will generate sufficient taxable income to realize the net deferred tax assets.


	Year Ended December 31,
	2020		2019		2018
Statutory federal tax rate	21.0	%	21.0	%	21.0	%
Increase (decrease) in rates resulting from:
State taxes	1.8		2.6		2.5
Difference between statutory rate and foreign effective rate	2.1		2.7		(0.2)
Foreign, federal and state income tax credits	(2.8)		(3.3)		(1.5)
Non-deductible expenses	5.9		3.1		2.3
European Union state aid matter	—		—		(10.8)
Domestic benefit of foreign sales	(1.7)		(2.1)		(0.8)
United States transition tax	—		—		(2.6)
Tax rate change on deferred items	—		1.0		—
Unremitted earnings of foreign subsidiaries	—		2.3		(0.8)
Audit settlements	—		6.7		—
Other	(0.9)		(4.9)		(1.1)
Effective tax rate	25.4	%	29.1	%	8.0	%

The Company's effective tax rate in 2020 was higher than the United States Federal tax rate of 21.0 percent mainly due to state taxes, non-deductible expenses, accruals for unrecognized tax benefits and settlements with taxing authorities, and higher tax rates on income earned in foreign jurisdictions. These amounts were partially offset by tax credits generated in the United States and foreign jurisdictions. The Company's effective tax rate in 2019 was higher than the United States Federal Tax rate of 21.0 percent mainly due to accruals for settlements with various taxing authorities, state taxes, additional withholding tax due on future distributions of foreign earnings included in the transition tax levied by the Tax Act, and higher tax rates on income earned in foreign jurisdictions. The Company's effective tax rate in 2018 was lower than the United States Federal tax rate of 21.0 percent mainly due to recognition of previously unrecognized tax benefits relating to the European Union state aid recovery, excess tax benefits from stock compensation and a reduction in the accrual for the United States transition tax, offset partially by state taxes, higher tax rates applied to income earned in certain foreign jurisdictions, and other discrete items.

During the three-month period ending December 31, 2018, the Swedish Tax Authority (“STA”) issued a reassessment of tax for the year ending December 31, 2012 to one of the Company's non-operating subsidiaries in Sweden. The reassessment concerns the use of tax credits applied against capital gains pursuant to European Union Council Directive 2009/133/EC, commonly referred to as the EU Merger Directive, and assesses taxes and penalties totaling approximately $365.7 million (Swedish kroner 3.0 billion). On March 26, 2020, the Company received an adverse judgment from the First Instance Court of Sweden (the “Court”) regarding the STA's reassessment. The Company does not agree with the Court’s ruling, continues to believe the STA's arguments in the reassessment are not in accordance with Swedish tax regulations or the treaty for the avoidance of double taxation between Sweden and Belgium, and has appealed the decision to the Administrative Court of Appeal in Stockholm. Consequently, no adjustment to the Company's unrecognized tax benefits has been recorded in relation to this matter.

The Company has received a respite from paying the reassessment until after a decision by the Administrative Court of Appeal by putting in place a bank guarantee to secure possible future payment of the tax and interest. There can be no assurance that the Company's appeal will be successful.

During the third quarter of 2019, the European Commission announced the opening of a separate review to assess whether an excess profit tax ruling granted by Belgium to one of the Company's international subsidiaries is in breach of European Union state aid rules. The Company believes all taxes assessed by Belgium have been paid and has not adjusted unrecognized tax benefits in relation to this matter.

As of December 31, 2020 and 2019, the Company has accrued income tax liabilities of $37.1 million and $37.1 million, respectively, related to the Tax Act's transition tax which is paid in installments over an eight-year period and will not accrue interest. Approximately $3.9 million is due within the next twelve months.

As of December 31, 2020, the Company has undistributed earnings generated after January 1, 2018 by certain foreign subsidiaries of approximately $344.3 million that the Company intends to indefinitely invest outside the United States and on which it has not recognized deferred tax. Estimating the amount of potential tax is not practicable due to the complexity and variety of assumptions required.


	Year Ended December 31,
	2020		2019		2018
Balance, beginning of year	$	20,753	$	33,205	$	77,275
Increases related to current year tax positions	14,874		2,602		—
Increases related to prior year tax positions	2,485		2,719		2,229
Lapse of statute of limitations	(10,616)		(13,371)		(1,558)
Settlements	(1,764)		(4,402)		(40,514)
Change due to currency translation	—		—		(4,227)
Balance, end of year	$	25,732	$	20,753	$	33,205

The unrecognized tax benefits at December 31, 2020 relate to the United States, Belgium, United Kingdom and various other foreign jurisdictions, of which $24.4 million would affect the Company’s effective tax rate if recognized. The Company anticipates approximately $3.2 million of its net unrecognized tax benefits will be recognized within 12 months as the result of settlements or effective settlements with various tax authorities, the closure of certain audits and the lapse of the applicable statute of limitations.

The Company classifies interest and penalties related to unrecognized tax benefits in the income tax provision. As of December 31, 2020, the Company had $2.7 million of accrued interest and penalties related to unrecognized tax benefits that are recorded as current and non-current accrued income taxes on the Consolidated Balance Sheets.