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Income Taxes | 6 Months Ended
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Jun. 30, 2019
Income Tax Disclosure [Abstract] |
INCOME TAXES |
Note 4. | Income Taxes
In December 2017, the 2017 Tax Act was enacted in the United States. Beginning January 1, 2018, foreign earnings of the Company's international subsidiaries are generally exempt from U.S. Federal income tax upon repatriation. Notwithstanding these changes, certain withholding taxes and foreign exchange gains and losses will continue to be applicable upon the repatriation of foreign earnings. During 2018 and 2019, the Internal Revenue Service (IRS) and the U.S. Department of Treasury (Treasury) issued additional guidelines and clarifying regulations related to the implementation of the 2017 Tax Act. The Company expects that additional guidance will continue to be issued in future periods. As this guidance is issued, the Company will continue to evaluate the information to determine whether any additional adjustments to its tax provisions are required. The 2017 Tax Act included provisions for Global Intangible Low-Taxed Income (GILTI) under which taxes on foreign income are imposed on the excess of a deemed return on tangible assets of certain foreign subsidiaries and for Base Erosion and Anti-Abuse Tax (BEAT) under which taxes are imposed on certain base eroding payments to affiliated foreign companies. The Company treats BEAT and GILTI as components of current income tax expense. Income tax expense for the three and six months ended June 30, 2019 and 2018 had no tax expense related to GILTI. In February 2018, the FASB issued amended guidance for reporting comprehensive income to reflect changes resulting from the 2017 Tax Act. The amendment, which had an effective date of January 1, 2019, provided the option to reclassify stranded tax effects resulting from the 2017 Tax Act within accumulated other comprehensive income (AOCI) to retained earnings. The Company elected to not reclassify stranded income tax effects from AOCI to retained earnings, including those related to implementation of the 2017 Tax Act. Our consolidated effective income tax rate was 23.6% and 25.9% for the three and six months ended June 30, 2019, as compared to 25.8% and 28.5% for the comparable periods in 2018. The effect of higher average foreign tax rates of our international subsidiaries, when compared to U.S. federal and state tax rates, were impacted by the following items. The effective tax rate in 2019 benefited from available U.S foreign tax credits associated with withholding taxes of our foreign operations, U.S. income tax deductions for Foreign-derived intangible income (FDII), and a state income tax refund. These benefits were partially offset by lower share-based compensation deductions in 2019 from stock option exercises when compared to the same periods in 2018 and higher state income tax expense when excluding the state income tax refund recorded during the second quarter of 2019. In addition, 2018 included higher income tax expense related to an estimated BEAT tax liability and an adjustment made to the provisional Transition Tax liability associated with enactment of the 2017 Tax Act. As discussed above, some elements of the recorded impacts of the 2017 Tax Act could be impacted by further legislative action as well as additional interpretations and guidance issued by the IRS or Treasury. As a result, the amount of income tax recorded in the future may differ, possibly materially. For further information and discussion of the potential impact of the 2017 Tax Act, refer to Note 5 to the consolidated financial statements in the Company's 2018 Annual Report on Form 10-K.

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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