Income Taxes (Tables)

12 Months Ended

Dec. 31, 2012

Income Tax Disclosure [Abstract]

Components of Deferred tax Assets and Liabilities

Significant components of GATX’s deferred tax liabilities and assets as of December 31 were (in millions):

	2012			2011
Deferred Tax Liabilities
Book/tax basis difference due to depreciation	$	806.7		$	756.2
Leveraged leases	—			62.7
Investments in affiliated companies	81.6			82.4
Lease accounting (other than leveraged)	12.6			13.7
Other	3.1			2.9
Total deferred tax liabilities	904.0			917.9
Deferred Tax Assets
Alternative minimum tax credit	5.2			8.9
Federal net operating loss	—			38.1
Foreign tax credit	7.3			13.9
Valuation on foreign tax credit	(7.3		)	(13.9		)
State net operating loss	26.6			31.1
Valuation on state net operating loss	(12.8		)	(15.8		)
Foreign net operating loss	9.5			7.3
Accruals not currently deductible for tax purposes	19.1			21.8
Allowance for losses	6.6			5.4
Pension and post-retirement benefits	48.6			40.7
Other	18.2			14.5
Total deferred tax assets	121.0			152.0
Net deferred tax liabilities	$	783.0		$	765.9

Gross liability for unrecognized tax benefits

A reconciliation of the beginning and ending amount of gross liability for unrecognized tax benefits is as follows (in millions):

	2012			2011
Beginning balance	$	20.8		$	42.7
Reductions due to expiration of the applicable statute of limitations	(16.1		)	—
Reductions due to settlement of audit issues	—			(21.9		)
Ending balance	$	4.7		$	20.8

Income before income taxes

The components of income before income taxes, excluding domestic and foreign joint ventures, for the years ending December 31 consisted of (in millions):

	2012		2011		2010
Domestic	$	80.5	$	39.5	$	5.1
Foreign	63.3		68.1		54.2
	$	143.8	$	107.6	$	59.3

Consolidated federal income taxes

GATX and its U.S. subsidiaries file a consolidated federal income tax return. Income taxes, excluding domestic and foreign joint ventures, for the years ending December 31 consisted of (in millions):

	2012			2011		2010
Current
Domestic:
Federal	$	(8.8	)	$	0.7	$	(0.2	)
State and local	2.5			0.8		0.8
	(6.3		)	1.5		0.6
Foreign	8.0			5.0		5.0
	1.7			6.5		5.6
Deferred
Domestic:
Federal	16.0			8.9		(3.1		)
State and local	(3.1		)	0.5		0.3
	12.9			9.4		(2.8		)
Foreign	11.5			13.3		4.2
	24.4			22.7		1.4
Income taxes	$	26.1		$	29.2	$	7.0

Summary of reasons for difference between GATX's effective income tax rate and federal statutory income tax

The reasons for the difference between GATX’s effective income tax rate and the federal statutory income tax rate for the years ending December 31 were (in millions):

	2012			2011			2010
Income taxes at federal statutory rate	$	50.4		$	37.7		$	20.8
Adjust for effect of:
Foreign tax credits	(13.7		)	(0.1		)	—
Foreign earnings taxed at lower rates	(4.1		)	(6.7		)	(2.7		)
Tax effect of foreign dividends	6.3			—			—
Expiration of the applicable statute of limitations	(15.5		)	—			—
Settlement of audit issues	—			(4.8		)	(9.5		)
Corporate owned life insurance	(0.3		)	(0.2		)	(2.4		)
State income taxes	1.9			1.1			0.1
Other	1.1			2.2			0.7
Income taxes	$	26.1		$	29.2		$	7.0
Effective income tax rate	18.2		%	27.1		%	11.8		%