
For the years ended December 31,	2020		2019		2018
Current:
Federal	$	117,348	$	179,358	$	151,107
State	46,198		38,232		38,243
Foreign	29,158		31,514		13,405
	192,704		249,104		202,755
Deferred:
Federal	24,486		14,958		35,035
State	3,746		1,865		7,572
Foreign	(1,352)		(31,895)		(6,352)
	26,880		(15,072)		36,255
Total provision for income taxes	$	219,584	$	234,032	$	239,010

The U.S. Tax Cuts and Jobs Act, enacted in December 2017 (“U.S. tax reform”), significantly changed U.S. corporate income tax laws by, among other things, reducing the U.S. corporate income tax rate to 21% starting in 2018 and creating a territorial tax system with a one-time mandatory tax on previously deferred foreign earnings of U.S. subsidiaries. During 2018, we recorded net benefits totaling $19.5 million as measurement period adjustments to the net provisional charge related to the one-time mandatory tax on previously deferred earnings of non-U.S. subsidiaries.

Additionally, U.S. tax reform subjects a U.S. shareholder to current tax on global intangible low-taxed income ("GILTI") earned by certain foreign subsidiaries. We have elected to not recognize deferred taxes for temporary differences until such differences reverse as GILTI in future years.

Deferred taxes reflect temporary differences between the tax basis and financial statement carrying value of assets and liabilities. The significant temporary differences that comprised the deferred tax assets and liabilities are as follows:


December 31,	2020		2019
Deferred tax assets:
Post-retirement benefit obligations	$	58,059	$	56,384
Accrued expenses and other reserves	86,412		88,590
Stock-based compensation	18,831		19,304
Derivative instruments	15,550		16,864
Pension	8,203		3,952
Lease liabilities	64,192		64,988
Accrued trade promotion reserves	25,877		21,709
Net operating loss carryforwards	154,445		160,584
Capital loss carryforwards	15,401		26,022
Other	10,027		9,685
Gross deferred tax assets	456,997		468,082
Valuation allowance	(193,310)		(206,743)
Total deferred tax assets	263,687		261,339
Deferred tax liabilities:
Property, plant and equipment, net	180,633		161,449
Acquired intangibles	156,439		144,314
Lease ROU assets	46,778		48,419
Inventories	21,086		29,158


Other	58,410		46,984
Total deferred tax liabilities	463,346		430,324
Net deferred tax liabilities	$	(199,659)	$	(168,985)
Included in:
Non-current deferred tax assets, net	$	29,369	$	31,033
Non-current deferred tax liabilities, net	(229,028)		(200,018)
Net deferred tax liabilities	$	(199,659)	$	(168,985)

The valuation allowances as of December 31, 2020 and 2019 were primarily related to capital loss carryforwards and various foreign jurisdictions' net operating loss carryforwards and other deferred tax assets that we do not expect to realize.


For the years ended December 31,	2020		2019		2018
Federal statutory income tax rate	21.0	%	21.0	%	21.0	%
Increase (reduction) resulting from:
State income taxes, net of Federal income tax benefits	2.7		1.8		2.7

Business realignment and impairment charges	—		—		0.6
Foreign rate differences	(0.5)		(1.5)		(2.0)
Historic and solar tax credits	(7.7)		(3.4)		(3.5)
U.S. tax reform	—		—		(1.4)
Tax contingencies	0.1		0.9		0.5
Stock compensation	(0.6)		(1.3)		(0.3)
Valuation allowance release	—		(1.5)		—
Other, net	(0.3)		0.9		(0.6)
Effective income tax rate	14.7	%	16.9	%	17.0	%


December 31,	2020		2019
Balance at beginning of year	$	108,383	$	97,530
Additions for tax positions taken during prior years	10,641		9,327
Reductions for tax positions taken during prior years	(2,496)		(2,080)
Additions for tax positions taken during the current year	3,354		10,472
Settlements	—		(1,151)
Expiration of statutes of limitations	(11,339)		(5,715)
Balance at end of year	$	108,543	$	108,383

We report accrued interest and penalties related to unrecognized tax benefits in income tax expense. We recognized a net tax expense of $1,564, $3,824 and $1,785 in 2020, 2019 and 2018 , respectively, for interest and penalties. Accrued net interest and penalties were $11,542 as of December 31, 2020 and $9,978 as of December 31, 2019.

The Company and its subsidiaries file tax returns in the United States, including various state and local returns, and in other foreign jurisdictions. We are routinely audited by taxing authorities in our filing jurisdictions, and a number of these disputes are currently underway, including multi-year controversies at various stages of review, negotiation and litigation in Malaysia, Mexico, and the United States. The outcome of tax audits cannot be predicted with certainty, including the timing of resolution or potential settlements. If any issues addressed in our tax audits are resolved in a manner not consistent with management’s expectations, we could be required to adjust our provision for income taxes in the period such resolution occurs. Based on our current assessments, we believe adequate provision has been made for all income tax uncertainties.

We reasonably expect reductions in the liability for unrecognized tax benefits of approximately $6,803 within the next 12 months because of the expiration of statutes of limitations and settlements of tax audits.

As of December 31, 2020, we had approximately $762,601 of undistributed earnings of our international subsidiaries. During 2020, previously undistributed earnings of certain international subsidiaries were no longer considered indefinitely reinvested; however, the Company had previously recognized a one-time U.S. repatriation tax due under U.S. tax reform, and as a result, only an immaterial amount of withholding tax was recognized. We intend to continue to reinvest the remainder of the earnings outside of the United States for which there would be a material tax implication to distributing, such as withholding tax, for the foreseeable future and, therefore, have not recognized additional tax expense on these earnings beyond the one-time U.S. repatriation tax due under the 2017 Tax Cuts and Jobs Act.

We invest in partnerships which make equity investments in projects eligible to receive federal historic and energy tax credits. The investments are accounted for under the equity method and reported within other non-current assets in our Consolidated Balance Sheets. The tax credits, when realized, are recognized as a reduction of tax expense under the flow-through method, at which time the corresponding equity investment is written-down to reflect the remaining value of the future benefits to be realized. For the years ended December 31, 2020, 2019 and 2018 we recognized investment tax credits and related outside basis difference benefits totaling $146,021, $58,798 and $60,111, respectively, and we wrote-down the equity investment by $125,579, $50,457 and $50,329, respectively, to reflect the realization of these benefits. The equity investment write-down is reflected within other (income) expense, net in the Consolidated Statements of Income (see Note 1 7).