Income Taxes	9 Months Ended
Sep. 30, 2014
Income Taxes
Income Taxes	Note H — Income Taxes Our third quarter 2014 income tax expense of $4.1 million resulted in an effective income tax rate of 38.7%. Our first nine months of 2014 income tax expense of $9.0 million resulted in an effective income tax rate of 39.4%. Our effective income tax rate is derived by estimating pretax income and income tax expense for the year ending December 31, 2014. The effective income tax rate calculated for the first nine months of 2014 is higher than the federal statutory rate of 35.0%, primarily due to the addition of state income taxes. Our third quarter 2013 income tax expense of $2.6 million resulted in an effective income tax rate of 37.3%. Our first nine months of 2013 income tax expense of $10.8 million resulted in an effective income tax rate of 37.9% which benefited from favorable first quarter discrete items including reductions in tax accruals related to certain foreign subsidiaries, and to additional tax credits made available by the American Taxpayer Relief Act of 2012 enacted in January of 2013. The effective income tax rate calculated for the first nine months of 2013 is higher than the federal statutory rate of 35.0%, primarily due to the addition of state income taxes. Harte Hanks files income tax returns in the U.S. federal, U.S. state and foreign jurisdictions. For U.S. state and foreign returns, we are no longer subject to tax examinations for tax years prior to 2010. For U.S. federal returns, we are no longer subject to tax examinations for tax years prior to 2011. We have elected to classify any interest expense and penalties related to income taxes within income tax expense in our Consolidated Statements of Comprehensive Income. We did not have a significant amount of interest or penalties accrued at September 30, 2014 or December 31, 2013.

Income Taxes

9 Months Ended

Sep. 30, 2014

Note H — Income Taxes

Our third quarter 2014 income tax expense of $4.1 million resulted in an effective income tax rate of 38.7%. Our first nine months of 2014 income tax expense of $9.0 million resulted in an effective income tax rate of 39.4%. Our effective income tax rate is derived by estimating pretax income and income tax expense for the year ending December 31, 2014. The effective income tax rate calculated for the first nine months of 2014 is higher than the federal statutory rate of 35.0%, primarily due to the addition of state income taxes.

Our third quarter 2013 income tax expense of $2.6 million resulted in an effective income tax rate of 37.3%. Our first nine months of 2013 income tax expense of $10.8 million resulted in an effective income tax rate of 37.9% which benefited from favorable first quarter discrete items including reductions in tax accruals related to certain foreign subsidiaries, and to additional tax credits made available by the American Taxpayer Relief Act of 2012 enacted in January of 2013. The effective income tax rate calculated for the first nine months of 2013 is higher than the federal statutory rate of 35.0%, primarily due to the addition of state income taxes.

Harte Hanks files income tax returns in the U.S. federal, U.S. state and foreign jurisdictions. For U.S. state and foreign returns, we are no longer subject to tax examinations for tax years prior to 2010. For U.S. federal returns, we are no longer subject to tax examinations for tax years prior to 2011.

We have elected to classify any interest expense and penalties related to income taxes within income tax expense in our Consolidated Statements of Comprehensive Income. We did not have a significant amount of interest or penalties accrued at September 30, 2014 or December 31, 2013.