INCOME TAXES.

The provision for income taxes consists of:



(in millions)	2015			2016		2017
Current income taxes
U.S. federal	$	669.5		$	573.7	$	708.1
State and local	134.3			105.8		131.0
Foreign	18.9			13.5		13.1
Deferred income taxes (tax benefits)	(43.3		)	13.5		71.7
Total	$	779.4		$	706.5	$	923.9

Our income tax provision for 2017 includes a non-recurring charge of $71.1 million to reflect the effect of the U.S. tax law changes enacted on December 22, 2017. The recognized charge is our reasonable estimate based on current interpretation of the tax law changes and includes $18.9 million for the remeasurement of our deferred tax assets and liabilities, and a $52.2 million U.S. federal and state tax charge for the mandatory deemed repatriation of foreign sourced net earnings. The federal tax portion will be payable over the next 8 years. We will continue to evaluate the impact of the tax law changes on our estimates and expectations due to changes in our interpretations of the law, assumptions used in applying the law, and additional guidance concerning the law that may be issued. We will report any applicable adjustments to these estimates in 2018 after our estimates are finalized.

Deferred income taxes and benefits arise from temporary differences between taxable income for financial statement and income tax return purposes. The deferred income taxes (tax benefits) recognized as part of our provision for income taxes is related to:



(in millions)	2015			2016			2017
Property and equipment	$	(2.3	)	$	3.2		$	(3.9	)
Stock-based compensation	(14.6		)	1.3			72.4
Accrued compensation	(.9		)	(1.7		)	1.2
Supplemental savings plan liability	(27.4		)	(30.9		)	(8.3		)
Other-than-temporary impairments of available-for-sale investments	(.4		)	10.0			7.3
Unrealized holding gains recognized in non-operating income	(2.4		)	31.6			10.7
Other	4.7			—			(7.7		)
Total deferred income taxes (tax benefits)	$	(43.3	)	$	13.5		$	71.7

The following table reconciles the statutory federal income tax rate to our effective income tax rate.



	2015		2016		2017
Statutory U.S. federal income tax rate	35.0	%	35.0	%	35.0	%
Impact of U.S. tax reform	—		—		2.9
State income taxes for current year, net of federal income tax benefits⁽¹⁾	4.3		3.8		3.9
Net income attributable to redeemable non-controlling interests	—		(.7	)	(1.3	)
Net excess tax benefits from stock-based compensation plans activity	—		(1.7	)	(3.0	)
Other items	(.4	)	(.4	)	(.6	)
Effective income tax rate	38.9	%	36.0	%	36.9	%

⁽¹⁾In 2017, state income benefits totaling (.4)% are reflected in the total benefits for net income attributable to redeemable non-controlling interests and stock-based compensation plans activity. The amounts were not material in 2015 and 2016.

The net deferred tax assets recognized in our consolidated balance sheets in other assets as of December 31 relate to the following:



(in millions)	2016			2017
Deferred tax liabilities
Property and equipment	$	(39.2	)	$	(35.3	)
Net unrealized holding gains recognized in income	(43.2		)	(53.9		)
Net unrealized holding gains on investments held as available-for-sale	(33.4		)	(3.1		)
Other	(27.5		)	(18.9		)
	(143.3		)	(111.2		)
Deferred tax assets
Stock-based compensation	165.1			92.7
Asset impairments	16.1			8.8
Accrued compensation	5.6			4.4
Supplemental savings plan	58.3			66.6
Currency translation adjustment	23.0			2.2
Other	7.7			6.8
	275.8			181.5
Net deferred tax asset	$	132.5		$	70.3

We have not recognized a state deferred tax liability for unremitted earnings of our foreign subsidiaries as T. Rowe Price intends to indefinitely reinvest these earnings outside the U.S. The unremitted earnings of these subsidiaries are estimated to be approximately $604 million at December 31, 2017. If these earnings were distributed to the U.S. in the form of dividends or otherwise, or if any of the entities were sold or otherwise transferred, we would be subject to state and local income taxes. Determination of the amount of the unrecognized deferred state liability related to these earnings is not practicable.

Other assets include tax refund receivables of $8.1 million at December 31, 2016, and $43.2 million at December 31, 2017.

Cash outflows from operating activities include net income taxes paid of $778.6 million in 2015, $680.6 million in 2016, and $857.7 million in 2017.

Additional income tax benefit arising from stock-based compensation plans activity totaling $23.2 million in 2015, $31.6 million in 2016, and $75.5 million in 2017 reduced the amount of income taxes that would have otherwise been payable. The income tax benefits for 2016 and 2017 were recognized in the income tax provision compared with additional paid in capital in 2015.

The following table summarizes the changes in our unrecognized tax benefits.



(in millions)	2015			2016			2017
Balance at beginning of year	$	5.6		$	5.8		$	6.2
Changes in tax positions related to
Current year	.7			.6			1.5
Prior years	1.8			—			.1
Expired statute of limitations	(2.3		)	(.2		)	(.2		)
Balance at end of year	$	5.8		$	6.2		$	7.6

If recognized, these tax benefits would affect our effective tax rate; however, we do not expect that unrecognized tax benefits for tax positions taken with respect to 2017 and prior years will significantly change in 2018. The U.S. has concluded examinations related to federal tax obligations through the year 2015. A net interest payable related to our unrecognized tax benefits of $1.2 million at December 31, 2016, and $1.5 million at December 31, 2017, are recognized in our consolidated balance sheets. Our accounting policy with respect to interest and penalties arising from income tax settlements is to recognize them as part of our provision for income taxes. Interest recognized as part of our provision for income taxes was not material.