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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2022

Income Tax Disclosure [Abstract]

Earnings Before Income Taxes and Equity Earnings

The source of earnings before income taxes and equity earnings consisted of the following: 

(Amounts in millions)						2022						2021						2020
United States						$	1,028.7					$	911.4					$	715.9
Foreign						173.9						175.5						119.3
Total						$	1,202.6					$	1,086.9					$	835.2

Components of Income Tax

The provision (benefit) for income taxes consisted of the following: 

(Amounts in millions)						2022						2021						2020
Current:
Federal						$	185.4					$	152.9					$	136.8
Foreign						45.2						48.2						29.9
State						48.4						37.5						30.6
Total current						279.0						238.6						197.3
Deferred:
Federal						(8.5)						6.1						(10.0)
Foreign						(2.1)						(0.3)						3.0
State						0.3						2.6						(1.2)
Total deferred						(10.3)						8.4						(8.2)
Total income tax provision						$	268.7					$	247.0					$	189.1

Reconciliation of Statutory Federal Income Tax Rate

The following is a reconciliation of the statutory federal income tax rate to Snap-on’s effective tax rate: 

						2022						2021						2020
Statutory federal income tax rate						21.0%						21.0%						21.0%
Increase (decrease) in tax rate resulting from:
State income taxes, net of federal benefit						3.0						2.8						2.9
Noncontrolling interests						(0.4)						(0.4)						(0.5)
Repatriation of foreign earnings						(0.3)						(0.5)						(0.7)
Change in valuation allowance for deferred tax assets						0.3						0.2						0.5
Adjustments to tax accruals and reserves						(0.7)						0.3						(0.5)
Foreign rate differences						0.4						0.5						0.5
Excess tax benefits related to equity compensation						(0.5)						(1.0)						(0.5)
Other						(0.5)						(0.2)						(0.1)
Effective tax rate						22.3%						22.7%						22.6%

Schedule of Deferred Tax Assets and Liabilities

Temporary differences that give rise to the net deferred income tax liability as of 2022, 2021 and 2020 year end are as follows:

(Amounts in millions)						2022						2021						2020
Deferred income tax assets (liabilities):
Inventories						$	34.0					$	37.5					$	41.4
Accruals not currently deductible						66.9						77.6						75.1
Tax credit carryforward						4.2						1.2						2.4
Employee benefits						16.7						6.4						32.4
Net operating losses						47.9						35.0						37.1
Depreciation and amortization						(170.1)						(213.2)						(192.0)
Valuation allowance						(23.5)						(24.5)						(26.7)
Equity-based compensation						14.7						13.1						14.3
Undistributed non-U.S. earnings						(4.2)						(4.4)						(5.4)
Other						1.3						(1.9)						1.3
Net deferred income tax liability						$	(12.1)					$	(73.2)					$	(20.1)

Operating Loss Carry Forwards

As of 2022 year end, Snap-on had tax net operating loss carryforwards totaling $190.1 million as follows:

(Amounts in millions)						State						Federal						Foreign						Total
Year of expiration:
2023-2027						$	0.3					$	—					$	38.2					$	38.5
2028-2032						11.8						—						17.5						29.3
2033-2037						—						—						15.4						15.4
2038-2042						—						—						60.7						60.7
2043-2047						—						—						9.3						9.3
Indefinite						—						—						36.9						36.9
Total net operating loss carryforwards						$	12.1					$	—					$	178.0					$	190.1

Reconciliation of Unrecognized Tax Benefits

The following is a reconciliation of the beginning and ending amounts of unrecognized tax benefits for 2022, 2021 and 2020:

(Amounts in millions)						2022						2021						2020
Unrecognized tax benefits at beginning of year						$	8.9					$	9.1					$	10.3
Gross increases – tax positions in prior periods						—						0.4						0.4
Gross decreases – tax positions in prior periods						(0.3)						(0.4)						—
Gross increases – tax positions in the current period						0.6						0.4						0.4
Settlements with taxing authorities						(3.0)						—						(1.4)
Lapsing of statutes of limitations						(0.6)						(0.6)						(0.6)
Unrecognized tax benefits at end of year						$	5.6					$	8.9					$	9.1

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