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Income Taxes | 12 Months Ended
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Dec. 31, 2022
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes Earnings before income taxes for the years ended December 31, 2022, 2021 and 2020 consisted of the following components:
| 2022 |  | 2021 |  | 2020
United States | $ | 1,026.4 |  |  | $ | 814.7 |  |  | $ | 676.2 |
Other | 255.6 |  |  | 217.2 |  |  | 185.1 |
| $ | 1,282.0 |  |  | $ | 1,031.9 |  |  | $ | 861.3 |
Components of income tax expense for the years ended December 31, 2022, 2021 and 2020 were as follows:
| 2022 |  | 2021 |  | 2020
Current: |  |  |  |  |
Federal | $ | 322.9 |  |  | $ | 110.2 |  |  | $ | 142.9 |
State | 80.8 |  |  | 50.8 |  |  | 48.0 |
Foreign | 65.9 |  |  | 59.9 |  |  | 54.6 |
Deferred: |  |  |  |  |
Federal | (136.9) |  |  | 27.5 |  |  | (32.2) |
State | (31.1) |  |  | (27.2) |  |  | (26.8) |
Foreign | (5.2) |  |  | 5.4 |  |  | 1.0 |
| $ | 296.4 |  |  | $ | 226.6 |  |  | $ | 187.5 |
Reconciliations between the statutory federal income tax rate and the effective income tax rate for the years ended December 31, 2022, 2021 and 2020 were as follows:
| 2022 |  | 2021 |  | 2020
Federal statutory rate | 21.0 | % |  | 21.0 | % |  | 21.0 | %
Foreign operations, net | 0.8 |  |  | 2.5 |  |  | 2.1 |
R&D tax credits | (3.0) |  |  | (2.1) |  |  | (1.6) |
State taxes, net of federal benefit | 3.7 |  |  | 2.8 |  |  | 3.3 |
Stock-based compensation | (1.0) |  |  | (2.4) |  |  | (3.3) |
Impact of UK tax rate change | — |  |  | 2.0 |  |  | — |
Legal entity restructuring | 0.8 |  |  | (1.4) |  |  | — |
Other, net | 0.8 |  |  | (0.4) |  |  | 0.3 |
| 23.1 | % |  | 22.0 | % |  | 21.8 | %
The deferred income tax balance sheet accounts arise from temporary differences between the amount of assets and liabilities recognized for financial reporting and tax purposes. Components of the deferred tax assets and liabilities at December 31 were as follows:
| 2022 |  | 2021
Deferred tax assets: |  |  |
Reserves and accrued expenses | $ | 192.4 |  |  | $ | 179.6 |
Net operating loss carryforwards | 84.6 |  |  | 51.0 |
R&D credits | 8.9 |  |  | 12.5 |
Capitalized R&D expenditures | 97.8 |  |  | — |
Interest expense limitation carryforwards | 41.1 |  |  | 10.9 |
Outside basis differences on assets held for sale | — |  |  | 57.4 |
Lease liability | 50.1 |  |  | 46.2 |
Valuation allowance | (37.1) |  |  | (31.9) |
Total deferred tax assets | $ | 437.8 |  |  | $ | 325.7 |
Deferred tax liabilities: |  |  |
Reserves and accrued expenses | $ | 12.0 |  |  | $ | 17.3 |
Amortizable intangible assets | 1,818.7 |  |  | 1,656.2 |
Accrued tax on unremitted foreign earnings | 5.8 |  |  | 24.7 |
ROU asset | 48.0 |  |  | 43.7 |
Outside basis difference in Indicor | 174.2 |  |  | — |
Total deferred tax liabilities | $ | 2,058.7 |  |  | $ | 1,741.9 |
As of December 31, 2022, the Company has $46.6 of tax-effected U.S. federal net operating loss carryforwards and $38.0 of tax-effected state net operating loss carryforwards without regard to federal benefit of state. The majority of the net operating loss carryforwards are subject to limitation under the Internal Revenue Code of 1986, as amended (“IRC”) Section 382; however, the Company expects to utilize such losses in their entirety prior to expiration. As of December 31, 2022, the Company has $41.1 of IRC Section 163(j) interest expense limitation carryforwards which have an indefinite carryforward period. Collectively, the deferred tax assets for the federal and state net operating loss carryforward, interest expense limitation carryforward and the deferred tax liability for amortizable intangible assets each increased from 2021 to 2022 due primarily to the acquisition of Frontline Education. During the year ended December 31, 2022, the Company generated a $97.8 deferred tax asset related to changes under the Tax Cuts and Jobs Act which requires taxpayers to capitalize and amortize research and development (“R&D”) expenditures under section 174 for tax years beginning after December 31, 2021. The Company will amortize these costs for tax purposes over 5 years if the R&D was performed in the U.S. and over 15 years if the R&D was performed outside the U.S. In connection with the Indicor Transaction, the Company recognized a deferred tax liability of $174.2 in outside basis difference associated with the initial retained 49% minority equity interest in Indicor. The Company expects to settle this liability upon exit of the investment. As of December 31, 2022, the Company determined that a total valuation allowance of $37.1 was necessary to reduce U.S. federal and state deferred tax assets by $31.0 and foreign deferred tax assets by $6.1, where it was more likely than not that all such deferred tax assets will not be realized. As of December 31, 2022, the Company believes it is more likely than not that the remaining net deferred tax assets will be realized based on the Company’s estimates of future taxable income and any applicable tax-planning strategies within various tax jurisdictions. The Company recognizes in the Consolidated Financial Statements only those tax positions determined to be “more likely than not” of being sustained upon examination based on the technical merits of the positions. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
| 2022 |  | 2021 |  | 2020
Beginning balance | $ | 40.5 |  |  | $ | 63.5 |  |  | $ | 57.6 |
Additions for tax positions of prior periods | — |  |  | 2.2 |  |  | 6.0 |
Additions for tax positions of the current period | 2.3 |  |  | 3.3 |  |  | 3.5 |
Additions due to acquisitions | — |  |  | 1.0 |  |  | 6.2 |
Reductions for tax positions of prior periods | (11.2) |  |  | (0.5) |  |  | (3.6) |
Reductions attributable to lapses of applicable statute of limitations | (2.6) |  |  | (4.6) |  |  | (6.2) |
Reductions attributable to settlements with taxing authorities | — |  |  | (24.4) |  |  | — |
Ending balance | $ | 29.0 |  |  | $ | 40.5 |  |  | $ | 63.5 |
The total amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate is $28.8. Interest and penalties related to unrecognized tax expense were $0.3 in 2022 and are classified as a component of income tax expense. Accrued interest and penalties were $4.6 at December 31, 2022 and $4.3 at December 31, 2021. During the next twelve months, it is reasonably possible that the unrecognized tax benefits may decrease by a net $2.3, mainly due to anticipated statute of limitations lapses in various jurisdictions. The Company and its subsidiaries are subject to examinations for U.S. federal income tax as well as income tax in various state, city and foreign jurisdictions. The Company’s federal income tax returns for 2019 through the current period remain open to examination and the relevant state, city and foreign statutes vary. The Company does not expect the assessment of any significant additional tax in excess of amounts reserved. The Company intends to distribute all historical unremitted foreign earnings up to the amount of excess foreign cash, as well as all future foreign earnings that can be repatriated without incremental U.S. federal tax cost. Any remaining outside basis differences relating to the Company’s investment in foreign subsidiaries are not expected to be material and will be indefinitely reinvested.

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- 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://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI https://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI https://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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