|12 Months Ended|
Dec. 31, 2014
|Income Tax Disclosure [Abstract]|
The Companys income tax provision consisted of the following:
The primary factors causing income tax expense to be different than the federal statutory rate for 2014, 2013, and 2012 are as follows:
Other includes the release of deferred tax liabilities, tax credits, valuation allowance, and other immaterial adjustments.
The Provision for Income Taxes resulted in an effective tax rate of 37.3% on Income Before Income Taxes for the year ended December 31, 2014. The effective rate differs from the annual federal statutory rate primarily because of state and foreign income taxes.
For 2013 and 2012 the effective tax rate was 35.6% and 37.0%, respectively. The effective income tax rate differs from the annual federal statutory tax rate primarily because of state and foreign income taxes and the release of certain deferred tax liabilities.
During 2014, 2013, and 2012, the Company paid income taxes of $74.5 million, $69.4 million and $63.0 million, respectively, net of refunds.
Deferred income taxes reflect the net tax effects of the temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and income tax purposes. Significant components of the Companys deferred tax assets and liabilities at December 31, 2014 and 2013 are as follow:
Analysis of the valuation allowance:
As of December 31, 2014, the Company has net operating loss carryforwards for foreign and state income tax purposes of approximately $195.5 million, which will be available to offset future taxable income. If not used, these carryforwards will expire between 2015 and 2028. Management believes that it is unlikely to be able to utilize approximately $15.5 million of foreign net operating losses before they expire and has included a valuation allowance for the effect of these unrealizable operating loss carryforwards. The valuation allowance increased by $1.2 million due to the foreign net operating losses.
Earnings from continuing operations before income tax includes foreign income of $16.2 million, $17.0 million, and $15.6 million in 2014, 2013, and 2013, respectively. The Companys international business is expanding and we intend to continue to grow the business in foreign markets in the future through reinvestment of foreign deposits and future earnings as well as acquisition of unrelated companies. Repatriation of cash from the Companys foreign subsidiaries is not part of the Companys current business plan.
There were no unrecognized tax benefits at December 31, 2014. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
The Company and its subsidiaries are subject to U.S. federal income tax as well as income tax of multiple state and foreign jurisdictions. In addition, the Company has subsidiaries in various state and international jurisdictions that are currently under audit for years ranging from 2007 through 2013. With few exceptions, we are no longer subject to U.S. federal, state and local, or non-U.S., income tax examinations for years prior to 2010.
It is reasonably possible that the amount of unrecognized tax benefits will increase in the next 12 months.
The Companys policy is to record interest and penalties related to income tax matters in income tax expense. Accrued interest and penalties were $0.5 million and $0.5 million as of December 31, 2014 and December 31, 2013, respectively. During 2014 the Company recognized interest and penalties of $0.1 million.
The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.
Reference 1: http://www.xbrl.org/2003/role/presentationRef