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Income Taxes
3 Months Ended
Mar. 31, 2016
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes

The provision for income taxes was $20.1 million for the three months ended March 31, 2016 compared to $15.9 million in the three months ended March 31, 2015. The effective income tax rate was 33.4% for the three months ended March 31, 2016 and 35.9% for the same period in 2015. The quarter-over-quarter decrease in the effective income tax rate was largely due to an estimated greater percentage of 2016 pretax income being earned in lower tax countries and favorable tax law changes affecting the three months ended March 31, 2016, which was partially offset by an increase in non-deductible expenses relating to acquisitions.

As of March 31, 2016 and December 31, 2015, the Company had gross unrecognized tax benefits of $27.0 million and $25.9 million, respectively. The unrecognized tax benefits as of March 31, 2016 relate primarily to the utilization of certain tax attributes, state income tax positions, the ability to realize certain refund claims, and intercompany transactions. It is reasonably possible that the gross unrecognized tax benefits will decrease by approximately $1.6 million within the next 12 months due to the anticipated closure of audits and the expiration of certain statutes of limitation.

In July 2015, the United States Tax Court (the “Court”) issued an opinion relating to the treatment of stock-based compensation expense in an inter-company cost-sharing arrangement. In its opinion, the Court held that affiliated companies may exclude stock-based compensation expense from their cost-sharing arrangement. In February 2016, the Internal Revenue Service filed notice of its intent to appeal the decision. Because of uncertainty related to the final resolution of this litigation and the recognition of potential benefits to the Company, the Company has not recorded any financial benefit associated with this decision. The Company will monitor developments related to this case and the potential impact of those developments on the Company’s current and future financial statements.