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Income Taxes | 12 Months Ended
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Dec. 31, 2024
Income Tax Disclosure [Abstract] |
Income Taxes | 14. Income Taxes Income taxes have been based on the following components of earnings before provision for income taxes and discontinued operations in the consolidated statements of earnings:
| Years Ended December 31,
| 2024 |  | 2023 |  | 2022
Domestic | $ | 1,127,389 |  |  | $ | 608,423 |  |  | $ | 634,494 |
Foreign | 629,627 |  |  | 514,577 |  |  | 555,709 |
Total | $ | 1,757,016 |  |  | $ | 1,123,000 |  |  | $ | 1,190,203 |
Income tax expense (benefit) related to continuing operations for the years ended December 31, 2024, 2023 and 2022 is comprised of the following:
| Years Ended December 31,
| 2024 |  | 2023 |  | 2022
Current: |  |  |  |  |
U.S. federal | $ | 233,348 |  |  | $ | 114,195 |  |  | $ | 87,950 |
State and local | 47,199 |  |  | 13,930 |  |  | (1,570) |
Foreign | 168,151 |  |  | 143,216 |  |  | 140,696 |
Total current | 448,698 |  |  | 271,341 |  |  | 227,076 |
Deferred: |  |  |  |  |
U.S. federal | (35,304) |  |  | (28,471) |  |  | (4,760) |
State and local | (12,362) |  |  | 4,047 |  |  | 303 |
Foreign | (43,984) |  |  | (67,781) |  |  | (22,328) |
Total deferred | (91,650) |  |  | (92,205) |  |  | (26,785) |
Provision for income taxes | $ | 357,048 |  |  | $ | 179,136 |  |  | $ | 200,291 |
Differences between the effective income tax rate and the U.S. federal income statutory tax rate are as follows:
| Years Ended December 31,
| 2024 |  | 2023 |  | 2022
U.S. federal income tax rate | 21.0 | % |  | 21.0 | % |  | 21.0 | %
State and local taxes, net of federal income tax benefit | 1.0 |  |  | 1.5 |  |  | 1.5 |
Foreign operations tax effect | 0.6 |  |  | 0.5 |  |  | 0.2 |
Foreign-derived intangible income | (1.0) |  |  | (1.5) |  |  | (1.4) |
Share awards | (0.3) |  |  | (0.4) |  |  | (0.2) |
Withholding tax | 0.1 |  |  | 2.7 |  |  | 0.2 |
Change in valuation allowance | (0.4) |  |  | (6.2) |  |  | (0.8) |
Dispositions | 0.6 |  |  | — |  |  | — |
Tax credits | (0.4) |  |  | (0.6) |  |  | (0.5) |
Audit resolutions | (0.2) |  |  | (0.7) |  |  | (3.5) |
Other | (0.7) |  |  | (0.3) |  |  | 0.3 |
Effective tax rate | 20.3 | % |  | 16.0 | % |  | 16.8 | %
The tax effects of temporary differences that give rise to deferred tax assets and liabilities are as follows:
| December 31, 2024 |  | December 31, 2023
Deferred Tax Assets: |  |  |
Accrued compensation, postretirement and other employee benefits | $ | 45,145 |  |  | $ | 46,068 |
Accrued expenses | 17,218 |  |  | 20,154 |
Net operating loss and other carryforwards | 311,043 |  |  | 326,437 |
Inventories | 31,583 |  |  | 28,729 |
Allowance for credit losses | 8,428 |  |  | 7,679 |
Accrued insurance | 2,340 |  |  | 4,574 |
Long-term liabilities, warranty and environmental costs | 6,818 |  |  | 1,864 |
Lease obligations | 51,837 |  |  | 55,634 |
Capitalized research and development | 68,240 |  |  | 54,397 |
Total gross deferred tax assets | 542,652 |  |  | 545,536 |
Valuation allowance | (198,082) |  |  | (209,931) |
Total deferred tax assets, net of valuation allowances | $ | 344,570 |  |  | $ | 335,605 |
Deferred Tax Liabilities: |  |  |
Intangible assets | $ | (440,946) |  |  | $ | (405,504) |
Property, plant and equipment | (69,920) |  |  | (78,668) |
Lease right-of-use assets | (48,088) |  |  | (52,769) |
Other liabilities | (21,250) |  |  | (34,642) |
Total deferred tax liabilities | (580,204) |  |  | (571,583) |
Net deferred tax liability | $ | (235,634) |  |  | $ | (235,978) |
Classified as follows in the Consolidated Balance Sheets: |  |  |
Other assets and deferred charges | $ | 116,372 |  |  | $ | 110,405 |
Deferred income taxes | (352,006) |  |  | (346,383) |
| $ | (235,634) |  |  | $ | (235,978) |
As of December 31, 2024, the Company has $263,742 of deferred tax assets recorded related to non-U.S. tax loss carryforwards primarily resulting from non-operating activities and tax credit carryforwards. The non-U.S. losses and credits as of December 31, 2024 are available to be carried forward, with $112,438 expiring during the years 2025 through 2044, and the remaining $151,304 carried forward indefinitely. As of December 31, 2024, the Company has $47,301 of deferred tax assets recorded related to U.S. federal and state tax loss and tax credit carryforwards. The U.S. federal and state tax losses and credits as of December 31, 2024 are available to be carried forward, with $41,840 expiring during the years 2025 through 2044, and the remaining $5,461 carried forward indefinitely. The Company maintains valuation allowances by jurisdiction against the deferred tax assets related to certain of these carryforwards for which it is more likely than not that some portion or all will not be realized. The following table is a reconciliation of the beginning and ending balances of the Company's valuation allowance on deferred tax assets:
| Total
Balance at January 1, 2022 | $ | 306,066 |
Additions | 4,960 |
Reductions | (39,823) |
Balance at December 31, 2022 | 271,203 |
Additions | 31,388 |
Reductions | (92,660) |
Balance at December 31, 2023 | 209,931 |
Additions | 27,192 |
Reductions | (39,041) |
Balance at December 31, 2024 | $ | 198,082 |
Unrecognized Tax Benefits The Company files U.S federal, state, local and non-U.S. tax returns. The Company is routinely audited by the tax authorities in these jurisdictions, and a number of audits are currently underway. It is reasonably possible during the next twelve months that uncertain tax positions may be settled, which could result in a decrease in the gross amount of unrecognized tax benefits. This decrease may result in an income tax benefit. Due to the potential for resolution of U.S federal, state and non-U.S. examinations, and the expiration of various statutes of limitation, the Company's gross unrecognized tax benefits balance may change within the next twelve months by a range of zero to $3,699. All significant U.S. federal, state, local and non-U.S. matters have been concluded through 2021. The Company believes adequate provision has been made for all income tax uncertainties. The following table is a reconciliation of the beginning and ending balances of the Company's unrecognized tax benefits:
|  |  |  |  | Total
Unrecognized tax benefits at January 1, 2022 |  |  |  |  | $ | 64,652 |
Additions based on tax positions related to the current year |  |  |  |  | 3,315 |
Additions for tax positions of prior years |  |  |  |  | 3,421 |
Reductions for tax positions of prior years |  |  |  |  | (39,439) |
Cash settlements |  |  |  |  | (411) |
Lapse of statutes |  |  |  |  | (3,352) |
Unrecognized tax benefits at December 31, 2022 |  |  |  |  | 28,186 |
Additions based on tax positions related to the current year |  |  |  |  | 1,235 |
Additions for tax positions of prior years |  |  |  |  | 2,223 |
Reductions for tax positions of prior years |  |  |  |  | (3,361) |
Cash settlements |  |  |  |  | (1,791) |
Lapse of statutes |  |  |  |  | (3,983) |
Unrecognized tax benefits at December 31, 2023 |  |  |  |  | 22,509 |
Additions based on tax positions related to the current year |  |  |  |  | 33,688 |
Additions for tax positions of prior years |  |  |  |  | 507 |
Reductions for tax positions of prior years |  |  |  |  | (337) |
Cash settlements |  |  |  |  | (2,307) |
Lapse of statutes |  |  |  |  | (4,314) |
Unrecognized tax benefits at December 31, 2024 |  |  |  |  | $ | 49,746 |
If recognized, the net amount of potential tax benefits as of December 31, 2024 that would impact the Company's effective tax rate is $42,913. During the years ended December 31, 2024, 2023 and 2022, the Company recorded income of $617, $1,378 and $8,931, respectively, as a component of provision for income taxes related to the accrued interest and penalties on net reductions to unrecognized tax benefits. The Company had accrued interest and penalties of $4,181 at December 31, 2024 and $4,798 at December 31, 2023, which are not included in the unrecognized tax benefits table above.

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