XML 58 R24.htm IDEA: XBRL DOCUMENT v3.25.0.1
Income Taxes
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
 The provision for income taxes from operations consisted of the following: 
 Years Ended December 31,
(in thousands)202420232022
Current
Federal$75,783 $89,954 $90,703 
State22,418 24,323 25,347 
Foreign17,855 15,824 12,544 
Deferred
Federal(787)(6,466)(5,806)
State690 (860)(801)
Foreign(4,140)(215)(7,917)
$111,819 $122,560 $114,070 
 

Income and loss from operations before income taxes for the years ended December 31, 2024, 2023, and 2022, respectively, consisted of the following:
 Years Ended December 31,
 (in thousands) 
202420232022
Domestic$395,777 $427,296 $437,506 
Foreign38,266 49,251 10,559 
$434,043 $476,547 $448,065 

As of December 31, 2024, the Company had $45.6 million of net operating loss carryforwards in various foreign taxing jurisdictions. Most of the tax losses can be carried forward indefinitely.

As of December 31, 2024, and 2023, the Company has valuation allowances of $12.7 million and $10.4 million, respectively. The valuation allowance increased by $2.3 million for the year ended December 31, 2024 and decreased by $0.8 million for the year ended December 31, 2023. The increase in the 2024 valuation allowances was primarily due to the increase in net operating losses in Europe. The decrease in the 2023 valuation allowances was primarily due to expiration of certain U.S. foreign tax credit.

As of December 31, 2024, the Company asserts that its accumulated undistributed earnings generated by our foreign subsidiaries are permanently reinvested and as such, has not recognized a US deferred tax liability on its investment in foreign subsidiaries. The Company will continue to assess its permanent reinvestment assertion on a quarterly basis.

Reconciliations between the statutory federal income tax rates and the Company’s effective income tax rates as a percentage of income before income taxes for its operations were as follows:
 Years Ended December 31,
202420232022
Federal tax rate21.0 %21.0 %21.0 %
State taxes, net of federal benefit4.1 %3.8 %4.4 %
Change in U.S. tax rate applied to deferred taxes0.1 %0.6 %— %
Change in valuation allowance0.5 %— %— %
True-up of prior year tax returns to tax provision— %(0.1)%— %
Difference between U.S. statutory and foreign local tax rates0.4 %0.4 %0.2 %
Change in uncertain tax position— %(0.6)%— %
Other(0.3)%0.6 %(0.1)%
Effective income tax rate25.8 %25.7 %25.5 %
The tax effects of the significant temporary differences that constitute the deferred tax assets and liabilities as of December 31, 2024, and 2023, respectively, were as follows:
 As of December 31,
 (in thousands)
20242023
Deferred asset taxes
State tax$1,388 $1,606 
Health claims1,910 2,845 
Inventories8,766 8,218 
Sales incentive and advertising allowances1,751 1,997 
Lease obligations23,493 17,880 
Stock-based compensation4,235 3,962 
Foreign tax credit carryforwards3,782 3,905 
Non-United States tax loss carry forward8,128 5,882 
Acquisition expense1,315 1,904 
Capitalized research & development expenditures11,627 9,369 
Other6,282 3,689 
Total deferred tax assets$72,677 $61,257 
  Less valuation allowances(12,727)(10,430)
  Total deferred asset taxes$59,950 $50,827 
Deferred tax liabilities
Depreciation$(26,886)$(23,484)
Goodwill and other intangibles amortization(96,779)(106,041)
Right of use assets(23,075)(17,517)
Hedging OCI(2,190)(1,386)
Total deferred tax liabilities(148,930)(148,428)
Total deferred tax liability
$(88,980)$(97,601)

A reconciliation of the beginning and ending amounts of unrecognized tax benefits in 2024, 2023 and 2022, respectively, were as follows, including foreign translation amounts:
Reconciliation of Unrecognized Tax Benefits (in thousands)
202420232022
Balance as of January 1$4,641 $7,232 $944 
Additions based on tax positions related to prior years585 39 6,528 
Reductions based on tax positions related to prior years(49)(103)(38)
Additions for tax positions of the current year647 463 73 
Lapse of statute of limitations(1,157)(2,990)(275)
Balance as of December 31$4,667 $4,641 $7,232 

During 2024, the Company’s uncertain tax positions decreased by $1.2 million, primarily due to positions for open years of which were assumed in the Company’s acquisition of ETANCO. Tax positions of $1.5 million, $2.0 million, and $0.2 million are included in the balance of unrecognized tax benefits as of December 31, 2024, 2023, and 2022, respectively, which if recognized, would reduce the effective tax rate.

The Company accrues interest and penalties related to unrecognized tax benefits in income tax expense in accordance with the Company’s accounting policy. The Company accrued $1.4 million, $0.7 million and $0.9 million as of December 31, 2024, 2023 and 2022, respectively for the potential payment of interest and penalties before income tax benefits. The Company does not expect any material changes in unrecognized tax benefits within the next 12 months.
 
As of December 31, 2024, the Company remained subject to federal income tax examinations in the U.S. for the tax years 2021 through 2024. In addition, tax years 2019 through 2024 remain open in various states, local and foreign jurisdictions.
On August 16, 2022, the Inflation Reduction Act “IRA” was signed into the law. The provisions included a new Corporate Alternative Minimum Tax "CAMT", an excise tax on stock buybacks, and significant tax incentives for energy and climate initiatives, all effective for tax year 2023 and onwards. The Company is not subject to the provisions of CAMT and does not expect the impact of the remaining provisions to be material.