XML 47 R15.htm IDEA: XBRL DOCUMENT
v3.19.3.a.u2

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2019
Income Tax Disclosure [Abstract] |
Income Taxes | Note 7. Income Taxes Earnings before income taxes were derived from the following sources:
| 2019 |  | 2018 |  | 2017
Domestic | $ | 977.6 |  |  | 905.0 |  |  | 809.4 |
Foreign | 66.1 |  |  | 82.0 |  |  | 63.7 |
Earnings before income taxes | $ | 1,043.7 |  |  | 987.0 |  |  | 873.1 |
Components of income tax expense (benefit) were as follows:
2019: | Current |  | Deferred |  | Total
Federal | $ | 177.4 |  |  | 11.3 |  |  | 188.7 |
State | 41.6 |  |  | 0.2 |  |  | 41.8 |
Foreign | 22.1 |  |  | 0.2 |  |  | 22.3 |
Income tax expense | $ | 241.1 |  |  | 11.7 |  |  | 252.8 |
2018: | Current |  | Deferred |  | Total
Federal | $ | 143.8 |  |  | 27.4 |  |  | 171.2 |
State | 38.8 |  |  | 0.2 |  |  | 39.0 |
Foreign | 24.1 |  |  | 0.8 |  |  | 24.9 |
Income tax expense | $ | 206.7 |  |  | 28.4 |  |  | 235.1 |
2017: | Current |  | Deferred |  | Total
Federal | $ | 270.6 |  |  | (33.1 | ) |  | 237.5 |
State | 33.2 |  |  | 3.3 |  |  | 36.5 |
Foreign | 20.5 |  |  | (0.0 | ) |  | 20.5 |
Income tax expense | $ | 324.3 |  |  | (29.8 | ) |  | 294.5 |
Income tax expense in the accompanying consolidated financial statements differed from the expected expense as follows:
| 2019 |  | 2018 |  | 2017
U.S. federal statutory income tax rate | 21.0 | % |  | 21.0 | % |  | 35.0 | %
U.S. federal income tax expense at statutory rate | $ | 219.2 |  |  | 207.3 |  |  | 305.6 |
Increase (decrease) attributed to: |  |  |  |  |
State income taxes, net of federal benefit | 32.8 |  |  | 30.2 |  |  | 21.5 |
Transition tax | — |  |  | 1.2 |  |  | 6.5 |
Remeasurement of deferred taxes for Tax Act | — |  |  | (11.5 | ) |  | (30.8 | )
Other, net | 0.8 |  |  | 7.9 |  |  | (8.3 | )
Total income tax expense | $ | 252.8 |  |  | 235.1 |  |  | 294.5 |
Effective income tax rate | 24.2 | % |  | 23.8 | % |  | 33.7 | %
The tax effects of temporary differences that give rise to deferred income tax assets and liabilities at year end consisted of the following:
| 2019 |  | 2018
Deferred income tax assets (liabilities): |  |  |
Inventory costing and valuation methods | $ | 4.3 |  |  | 4.2 |
Allowance for doubtful accounts | 2.7 |  |  | 3.2 |
Insurance reserves | 9.1 |  |  | 8.1 |
Customer promotions | 1.9 |  |  | 1.9 |
Stock-based compensation | 3.9 |  |  | 5.6 |
Operating lease liabilities | 62.5 |  |  | — |
Federal and state benefit of uncertain tax positions | 0.8 |  |  | 0.8 |
Foreign net operating loss and credit carryforwards | 3.2 |  |  | 3.2 |
Foreign valuation allowances | (2.8 | ) |  | (2.7 | )
Other, net | (0.0 | ) |  | 1.3 |
Total deferred income tax assets | 85.6 |  |  | 25.6 |
Property and equipment | (114.7 | ) |  | (104.7 | )
Operating lease ROU assets | (61.7 | ) |  | — |
Total deferred income tax liabilities | (176.4 | ) |  | (104.7 | )
Deferred income tax liabilities | $ | (90.8 | ) |  | (79.1 | )
A reconciliation of the beginning and ending amount of total gross unrecognized tax benefits was as follows:
| 2019 |  | 2018
Balance at beginning of year: | $ | 5.3 |  |  | 4.4 |
Increase related to prior year tax positions | 0.2 |  |  | 1.8 |
Decrease related to prior year tax positions | (0.2 | ) |  | (0.6 | )
Increase related to current year tax positions | 4.7 |  |  | 0.7 |
Decrease related to statute of limitation lapses | (1.4 | ) |  | (0.9 | )
Settlements | 0.0 |  |  | (0.1 | )
Balance at end of year: | $ | 8.6 |  |  | 5.3 |
Included in the liability for gross unrecognized tax benefits is an immaterial amount for interest and penalties, both of which we classify as a component of income tax expense. The amount of gross unrecognized tax benefits that would favorably impact the effective tax rate, if recognized, is not material. We do not anticipate significant changes in total unrecognized tax benefits during the next twelve months. The 2019 and 2018 liability is included in deferred income taxes in the Consolidated Balance Sheets. We file income tax returns in the United States federal jurisdiction, all states, and various local and foreign jurisdictions. We are no longer subject to income tax examinations by taxing authorities for taxable years before 2016 in the case of United States federal examinations, and with limited exception, before 2014 in the case of foreign, state, and local examinations. On December 22, 2017, the Tax Act was signed into law. The Tax Act made broad and complex changes to the U.S. tax code which include: a lowering of the U.S. federal corporate income tax rate from 35% to 21% effective January 1, 2018, accelerated expensing of qualified capital investments for a specific period, and a transition from a worldwide to a territorial tax system which requires companies to pay a one-time transition tax on certain unrepatriated earnings from foreign subsidiaries. ASC 740 requires a company to record the effects of a tax law change in the period of enactment which, for us, was fiscal 2017. ASU 2018-05 provides guidance on the application of the Tax Act which includes allowing a company to record a provisional amount during the measurement period for the impacts when the necessary information is not available, prepared, or analyzed in reasonable detail to complete its accounting for the change in the tax law. The measurement period ends when the company has obtained, prepared and analyzed the information necessary to finalize its accounting, but cannot extend beyond one year. We recorded income tax expense of $235.1 in 2018, or 23.8% of earnings before income taxes. The effective income tax rate was significantly impacted by the following two items: (1) The lower corporate tax rate provided by the Tax Act resulted in a lower tax rate beginning in the first quarter of 2018. The effective income tax rate includes the immaterial impact of the U.S. tax rate on certain offshore earnings referred to as GILTI, a new deduction for FDII, and the new alternative U.S. tax on certain BEAT payments from a U.S. company to any foreign related party. (2) Discrete income tax items to adjust our transition tax liability, reflect the impacts of accelerating depreciation for certain physical assets, and remeasure the impact of the U.S. tax rate on certain inter-company transactions. These discrete items resulted in approximately $7.1 of income tax benefit during 2018. The accounting for the income tax effects of the Tax Act was complete as of December 31, 2018. In general, it is our practice and intention to permanently reinvest the earnings of our foreign subsidiaries and repatriate earnings only when the tax impact is zero or very minimal and that position has not changed subsequent to the one-time transition tax under the Tax Act. Accordingly, no deferred taxes have been provided for withholding taxes or other taxes that would result upon repatriation of our approximately $288.1 of undistributed earnings from foreign subsidiaries to the U.S. as those earnings continue to be permanently reinvested.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition 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. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration