Income Taxes

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

(In thousands)	2021		2020		2019
Components of income before income taxes
U.S. (loss) income	$	(59,746)	$	109,726	$	128,569
Non-U.S. income	83,350		58,421		57,183
Income before income taxes	$	23,604	$	168,147	$	185,752
Provision for income taxes
Current
Federal	$	13,179	$	23,587	$	13,770
State	5,000		4,896		5,436
Non-U.S.	22,487		16,780		25,608
Total current provision	$	40,666	$	45,263	$	44,814
Deferred
Federal	$	(29,631)	$	(573)	$	6,137
State	(7,204)		(579)		1,412
Non-U.S.	(2,015)		(1,102)		(5,818)
Total deferred (benefit) provision	(38,850)		(2,254)		1,731
Provision for income taxes	$	1,816	$	43,009	$	46,545

*Year ended December 31, 2020 and 2019 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 4 to the consolidated financial statements.

On June 10, 2021 the United Kingdom ("U.K.") Parliament announced royal assent for Bill No. 12, on the Finance Act of 2021. This bill will increase the statutory rate from 19% to 25% in April 2023. The Company recorded this impact on its deferred tax balances in the second quarter of 2021.

Reconciliation of the U.S. federal income tax rates to our effective tax rate:

	2021		2020		2019
U.S. federal income tax rate	21.0	%	21.0	%	21.0	%
Nondeductible compensation	15.3	%	3.4	%	1.9	%
Valuation allowances	7.0	%	0.8	%	0.4	%
Employee share-based payments	(18.3)	%	(3.9)	%	(2.6)	%
Taxes on non-U.S. income	(10.9)	%	2.6	%	(0.5)	%
State income taxes-U.S.	(7.0)	%	2.0	%	2.9	%
Research and development credit	(5.3)	%	(1.2)	%	(0.6)	%
Foreign exchange on entity closures	(0.4)	%	—	%	1.8	%
Taxes on non-U.S. income - U.S., Canadian & European reorganization	—	%	0.7	%	0.3	%
Other	6.3	%	0.2	%	0.5	%
Effective income tax rate	7.7	%	25.6	%	25.1	%
*Year ended December 31, 2020 and 2019 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 4 to the consolidated financial statements.

Components of deferred tax assets and liabilities:

	December 31,
(In thousands)	2021		2020
Deferred tax assets
Product liability	$	71,709	$	33,689
Capitalized research and development	25,644		22,915
Employee benefits	—		10,539
Net operating losses and tax credit carryforwards	9,404		6,310
Accrued expenses and other reserves	4,627		5,195
Share-based compensation	3,619		3,588
Other	4,785		6,034
Total deferred tax assets	119,788		88,270
Valuation allowances	(8,812)		(7,188)
Net deferred tax assets	110,976		81,082
Deferred tax liabilities
Goodwill and intangibles	(79,285)		(39,040)
Property, plant and equipment	(17,088)		(14,649)
Employee benefits	(8,985)		—
Inventory	(1,264)		(10,591)
Other	(2,434)		(1,897)
Total deferred tax liabilities	(109,056)		(66,177)
Net deferred taxes	$	1,920	$	14,905

*December 31, 2020 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 4 to the consolidated financial statements.

At December 31, 2021, we had net operating loss carryforwards of approximately $39.8 million. All net operating loss carryforwards without a valuation allowance may be carried forward for a period of at least six years.

A reconciliation of the change in the tax liability for unrecognized tax benefits for the years ended December 31, 2021 and 2020 is as follows:

(In thousands)	2021		2020
Beginning balance	$	8,092	$	5,119
Adjustments for tax positions related to the current year	182		425
Adjustments for tax positions related to prior years	733		2,950
Settlements	(3,211)		—
Statute expiration	(859)		(402)
Ending balance	$	4,937	$	8,092

The total amount of unrecognized tax benefits, if recognized, would reduce our future effective tax rate. We have recognized tax benefits associated with these liabilities in the amount of $2.5 million and $2.7 million at December 31, 2021 and 2020, respectively.

We recognize interest related to unrecognized tax benefits in interest expense and penalties in operating expenses. Our liability for accrued interest and penalties related to uncertain tax positions was $0.8 million and $1.0 million at December 31, 2021 and 2020, respectively.

We are subject to regular review and audit by both foreign and domestic tax authorities. While we believe our tax positions will be sustained, the final outcome of tax audits and related litigation may differ materially from the tax amounts recorded in our consolidated financial statements.

We file a U.S. federal income tax return along with various state and foreign income tax returns. Examinations of our U.S. federal returns have been completed through 2018. Various state and foreign income tax returns may be subject to tax audits for periods after 2015.