Income Taxes

6 Months Ended

Jun. 30, 2019

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

In May 2019, the statute of limitations expired for our principal state jurisdictions in relation to the prior closure of our 2005-2009 IRS exam which resulted in a discrete tax benefit for the reversal of state tax reserves in the amount of $15.3 million. These reversals largely offset a concurrent write-off of a related FAFC pre-tax indemnification receivable.

The effective income tax rate for income taxes as a percentage of (loss)/income from continuing operations before equity in earnings/(losses) of affiliates and income taxes was a benefit of 72.0% and a provision of 23.7% for the three months ended June 30, 2019 and 2018, respectively, and a benefit of 79.1% and a provision of 16.5% for the six months ended June 30, 2019 and 2018, respectively.

For the three and six months ended June 30, 2019, when compared to 2018, the change in the effective income tax rate was primarily due to the aforementioned $15.3 million benefit related to the reversal of state tax reserves.

We are currently under examination for the years 2010 through 2012 and 2016, by the US, our primary taxing jurisdiction, and for other years by various state taxing authorities. It is reasonably possible the amount of the unrecognized benefits with respect to certain unrecognized tax positions could significantly increase or decrease within the next twelve months and would have an impact on net income. Currently, we expect expiration of statutes of limitations, within the next twelve months, for which we have tax reserves recorded of approximately $1.0 million as of June 30, 2019.