XML 38 R19.htm IDEA: XBRL DOCUMENT
v3.24.0.1

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2023
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The components of income before income taxes and the details of the provision for income taxes were as follows for the years ended December 31:
| 2023 |  | 2022 |  | 2021
| (In thousands)
Income before income taxes: |  |  |  |  |
Domestic | $ | 1,026,113 |  |  | $ | 893,478 |  |  | $ | 958,206 |
Foreign | 580,299 |  |  | 535,214 |  |  | 264,964 |
Total | $ | 1,606,412 |  |  | $ | 1,428,692 |  |  | $ | 1,223,170 |
Provision for income taxes: |  |  |  |  |
Current: |  |  |  |  |
Federal | $ | 206,477 |  |  | $ | 183,619 |  |  | $ | 99,706 |
Foreign | 144,476 |  |  | 119,148 |  |  | 146,890 |
State | 34,173 |  |  | 34,201 |  |  | 16,282 |
Total current | 385,126 |  |  | 336,968 |  |  | 262,878 |
Deferred: |  |  |  |  |
Federal | (69,956) |  |  | (37,810) |  |  | 23,538 |
Foreign | (15,113) |  |  | (20,818) |  |  | (56,572) |
State | (6,833) |  |  | (9,190) |  |  | 3,273 |
Total deferred | (91,902) |  |  | (67,818) |  |  | (29,761) |
Total provision | $ | 293,224 |  |  | $ | 269,150 |  |  | $ | 233,117 |
Significant components of the deferred tax (asset) liability were as follows at December 31:
| 2023 |  | 2022
| (In thousands)
Non-current deferred tax (asset) liability: |  |  |
Differences in basis of property and accelerated depreciation (1) | $ | 63,447 |  |  | $ | 43,594 |
Reserves not currently deductible | (130,761) |  |  | (131,958) |
Pensions | 75,834 |  |  | 66,558 |
Differences in basis of intangible assets and accelerated amortization | 880,666 |  |  | 726,525 |
Net operating loss carryforwards | (109,065) |  |  | (54,318) |
Share-based compensation | (14,296) |  |  | (13,279) |
Foreign Tax Credit Carryforwards | (9,327) |  |  | (2,317) |
Unremitted earnings | 15,033 |  |  | 12,429 |
Other | (25,893) |  |  | (13,448) |
| 745,638 |  |  | 633,786 |
Less: Valuation allowance | 16,766 |  |  | 9,613 |
| 762,404 |  |  | 643,399 |
Portion included in non-current assets | 74,291 |  |  | 50,868 |
Gross non-current deferred tax liability | $ | 836,695 |  |  | $ | 694,267 |
______________________ (1)Presented net of deferred tax assets of approximately $49.6 million and $34.1 million at December 31, 2023 and 2022, respectively, resulting from lease obligations. The Company’s effective tax rate reconciles to the U.S. Federal statutory rate as follows for the years ended December 31:
| 2023 |  | 2022 |  | 2021
U.S. Federal statutory rate | 21.0 | % |  | 21.0 | % |  | 21.0 | %
State income taxes, net of federal income tax benefit | 1.3 |  |  | 1.6 |  |  | 1.5 |
Foreign operations, net | 0.4 |  |  | (1.0) |  |  | (0.4) |
U.S. Benefits for Manufacturing, Export and credits | (3.2) |  |  | (2.9) |  |  | (2.6) |
Uncertain Tax Items | 1.0 |  |  | 1.0 |  |  | (0.1) |
Stock compensation | (0.6) |  |  | (0.9) |  |  | (1.7) |
U.S. Tax / (Benefit) on Foreign Earnings | (2.0) |  |  | (0.5) |  |  | 1.0 |
Other | 0.4 |  |  | 0.5 |  |  | 0.3 |
Consolidated effective tax rate | 18.3 | % |  | 18.8 | % |  | 19.0 | %
The Company elected to pay the cash tax cost of the one-time mandatory tax on previously deferred earnings of non-U.S. subsidiaries over an eight-year period. As of December 31, 2023, the Company has a remaining cash tax obligation of $35.9 million, $9.0 million is classified as current and the remaining portion is classified as non-current. The Company has evaluated the impact of the global intangible low-taxed income (“GILTI”) section of the Tax Act and has made a tax accounting policy election to record the annual tax cost of GILTI as a current period expense when incurred and, as such, will not be measuring an impact of GILTI in its determination of deferred taxes. As a result of the one-time mandatory deemed repatriation and the taxable inclusions under the GILTI provisions of the Tax Act, the Company has approximately $938.1 million in previously taxed income (“PTI”) as of December 31, 2023 which can be repatriated without incremental U.S. Federal tax. The Company intends to reinvest its earnings indefinitely in operations outside the United States except to the extent of the PTI. There has been no provision for U.S. deferred income taxes for the undistributed earnings over PTI of approximately $385.4 million and $60.4 million at December 31, 2023 and 2022 respectively because determination of the amount of the unrecognized deferred income tax liability on these undistributed earnings is not practicable. As of December 31, 2023, and 2022, the Company recorded deferred income taxes totaling $15.0 million and $12.4 million respectively in state income and foreign withholding taxes expected to be incurred when the cash amounts related to the previously taxed income are ultimately repatriated to the U.S. The Company is acquisitive and at times acquires entities with tax attributes (net operating losses or tax credits) that carry over to post-acquisition tax periods of the Company. At December 31, 2023, the Company had tax effected benefits, net of uncertain tax positions of $109.0 million related to net operating loss carryforwards, which will be available to offset future income taxes payable, subject to certain annual or other limitations based on foreign and U.S. tax laws. This amount includes net operating loss carryforwards of $1.9 million for federal income tax purposes with no valuation allowance for the U.S. consolidated group, $8.8 million for state income tax purposes with a valuation allowance of $2.8 million, and $98.3 million for foreign income tax purposes with a valuation allowance of $4.7 million. The federal and state net operating loss carryforwards, if not used, will expire between 2024 and 2043. The majority of the foreign net operating loss carryforwards can be carried forward indefinitely with the remaining portion set to expire between 2028 and 2043, if not used. At December 31, 2023, the Company had tax effected benefits of $17.5 million related to tax credit carryforwards, which will be available to offset future income taxes payable, subject to certain annual or other limitations based on foreign and U.S. tax laws. This primarily includes foreign tax credit carryforwards of $9.3 million, $7.0 million for state income tax purposes with a valuation allowance of $2.7 million, and $0.6 million for foreign income tax purposes with a valuation allowance of $0.6 million. These tax credit carryforwards, if not used, will expire between 2024 and 2043. As of December 31, 2023, the Company has $13.2 million of IRC Section 163(j) interest expense limitation carryforwards which have an indefinite carryforward period. The Company maintains a valuation allowance to reduce certain deferred tax assets to amounts that are more likely than not to be realized. This allowance relates to deferred tax assets established for federal, state, and foreign net operating losses, credit carryforwards, and other miscellaneous timing items. In 2023, the Company recorded a net increase of $7.2 million in the valuation allowance. The increase primarily relates to a valuation allowance of $4.0 million recorded against non-depreciable UK fixed assets which have been deemed unlikely to meet the recognition criteria. The remainder of the increase relates to valuation allowances recorded against foreign net operating losses and tax credits in the amounts of $2 million and $0.6 million respectively. At December 31, 2023, the Company had gross unrecognized tax benefits of $233.5 million, of which $185.2 million, if recognized, would impact the effective tax rate. At December 31, 2022, the Company had gross unrecognized tax benefits of $174.7 million, of which $128.5 million, if recognized, would impact the effective tax rate. At December 31, 2023 and 2022, the Company reported $18.3 million and $12.4 million, respectively, related to interest and penalties as a component of other long term liabilities in the consolidated balance sheet. During 2023, the Company recognized a net expense of $5.9 million, and in 2022 net expense of $3.2 million, for interest and penalties related to uncertain tax positions in the consolidated statement of income as a component of income tax expense. Approximately 56% of the Company’s overall tax liability is incurred in the United States. The Company files income tax returns in various other state and foreign tax jurisdictions, in some cases for multiple legal entities per jurisdiction. Generally, the Company has open tax years subject to tax audit on average of between three and six years in these jurisdictions. At December 31, 2023, the Internal Revenue Service ("IRS") audit of the Company's consolidated U.S. income tax returns for the year 2018 and 2019 is ongoing. The Company has not materially extended any other statutes of limitation for any significant location and has reviewed and accrued for, where necessary, tax liabilities for open periods including state and foreign jurisdictions that remain subject to examination. There have been no penalties asserted or imposed by the IRS related to substantial understatement of income, gross valuation misstatement or failure to disclose a listed or reportable transaction. During 2023, the Company added $75.5 million of tax, interest and penalties related to identified uncertain tax positions and reversed $10.7 million of tax and interest related to statute expirations and settlement of prior uncertain positions. During 2022, the Company added $43.4 million of tax, interest and penalties related to identified uncertain tax positions and reversed $4.4 million of tax and interest related to statute expirations and settlement of prior uncertain positions. The following is a reconciliation of the liability for uncertain tax positions at December 31:
| 2023 |  | 2022 |  | 2021
| (In millions)
Balance at the beginning of the year | $ | 174.7 |  |  | $ | 147.0 |  |  | $ | 100.7 |
Additions for tax positions related to the current year | 32.1 |  |  | 29.3 |  |  | 41.4 |
Additions for tax positions of prior years | 34.0 |  |  | 2.1 |  |  | 34.9 |
Reductions for tax positions of prior years | (0.6) |  |  | (1.0) |  |  | (1.5) |
Reductions related to settlements with taxing authorities | (0.1) |  |  | (0.2) |  |  | (0.1) |
Reductions due to statute expirations | (6.6) |  |  | (2.5) |  |  | (28.4) |
Balance at the end of the year | $ | 233.5 |  |  | $ | 174.7 |  |  | $ | 147.0 |
In 2023, the additions above primarily reflect the increase in tax liabilities for uncertain tax positions related to certain higher transfer pricing risks for intangible assets. The reductions above primarily relate to statute expirations. The net increase of $58.8 million in uncertain tax positions resulted in an increase of $34.8 million to income tax expense and the remainder primarily in goodwill. At December 31, 2023, tax, interest and penalties of $241.7 million were classified as a non-current liability and $10.2 million was reflected as a reduction against deferred tax assets.

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://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-13 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//740/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-14 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-21 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482526/740-270-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-17 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482603/740-30-50-2 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration