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6. Income Taxes | 12 Months Ended
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Dec. 31, 2012
Income Taxes [Abstract] |
Income Taxes [Text Block] | 6. INCOME TAXES The U.S. and international components of income before taxes are as follows (in millions):
|  | Year Ended December 31,
|  | 2012 |  | 2011 |  | 2010
U.S. |  | $ | 108.5 |  |  | $ | 110.6 |  |  | $ | 79.5 |
International |  | 114.4 |  |  | 125.2 |  |  | 140.8 |
Income before taxes |  | $ | 222.9 |  |  | $ | 235.8 |  |  | $ | 220.3 |
The provision for income taxes consists of the following (in millions):
|  | Year Ended December 31,
|  | 2012 |  | 2011 |  | 2010
Current tax expense (benefit): |  |  |  |  |  |
U.S. Federal |  | $ | 34.0 |  |  | $ | 28.6 |  |  | $ | (5.1 | )
State |  | 4.0 |  |  | 3.4 |  |  | 3.9 |
International |  | 32.1 |  |  | 35.8 |  |  | 35.2 |
Current tax expense |  | 70.1 |  |  | 67.8 |  |  | 34.0 |
Deferred tax (benefit) expense: |  |  |  |  |  |
U.S. Federal |  | (3.1 | ) |  | 6.7 |  |  | 5.9 |
State |  | (0.9 | ) |  | 0.4 |  |  | 0.2 |
International |  | (6.3 | ) |  | (9.1 | ) |  | (10.2 | )
Deferred tax benefit |  | (10.3 | ) |  | (2.0 | ) |  | (4.1 | )
Non-current tax (benefit) expense |  | (0.7 | ) |  | (8.1 | ) |  | 3.4 |
Provision for income taxes |  | $ | 59.1 |  |  | $ | 57.7 |  |  | $ | 33.3 |
The reconciliation between our effective tax rate on income before taxes and the statutory tax rate is as follows:
|  | Year Ended December 31,
|  | 2012 |  | 2011 |  | 2010
U. S. statutory tax rate |  | 35 | % |  | 35 | % |  | 35 | %
Impact of foreign operations |  | (3 | ) |  | (4 | ) |  | (6 | )
Research tax credits |  | (2 | ) |  | (4 | ) |  | (4 | )
Tax settlements and adjustments to unrecognized tax benefits |  | — |  |  | (3 | ) |  | 2 |
Repatriation of foreign earnings |  | — |  |  | — |  |  | (10 | )
Contingent consideration |  | (3 | ) |  | — |  |  | — |
Other |  | — |  |  | — |  |  | (2 | )
Provision for income taxes |  | 27 | % |  | 24 | % |  | 15 | %
The effective tax rate for 2012 reflected a tax benefit related to an adjustment to the fair value of the QuantaLife contingent consideration. The effective tax rate for 2012 does not include tax benefits from the U.S. federal tax research credits because the law extending this credit was not enacted until 2013. The effective tax rate for 2011 reflected tax benefits from nontaxable dividend income and the release of tax liabilities. The lower effective tax rate in 2010 was due to a $22.0 million foreign tax credit benefit related to a $164.0 million distribution from our foreign affiliates to the U.S. The effective tax rates for all three periods were lower than the U.S. statutory rate primarily due to tax benefits from differences between U.S. and foreign statutory tax rates, and research and development tax credits. Our foreign income is earned primarily in France and Switzerland. Switzerland's statutory tax rate is significantly lower than our U.S. statutory tax rate of 35%. Our effective tax rates are also significantly reduced by French tax incentives related to our research and development activities. Our effective tax rate may be impacted in the future, either favorably or unfavorably, by many factors including, but not limited to, changes to statutory tax rates, changes in tax laws or regulations, tax audits and settlements, and generation of tax credits. Deferred tax assets and liabilities reflect the tax effects of losses, credits, and temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of deferred tax assets and liabilities are as follows (in millions):
|  | December 31,
|  | 2012 |  | 2011
Deferred tax assets: |  |  |  |
Bad debt, inventory and warranty accruals |  | $ | 24.1 |  |  | $ | 24.7 |
Other post-employment benefits, vacation and other reserves |  | 26.5 |  |  | 16.6 |
Tax credit and net operating loss carryforwards |  | 62.1 |  |  | 64.2 |
Other |  | 18.3 |  |  | 17.2 |
Valuation allowance |  | (52.9 | ) |  | (48.9 | )
|  | 78.1 |  |  | 73.8 |
Deferred tax liabilities: |  |  |  |
Depreciation |  | 8.6 |  |  | 13.5 |
Basis of capital assets and investments |  | 119.3 |  |  | 86.3 |
|  | 127.9 |  |  | 99.8 |
Net deferred tax liabilities |  | $ | (49.8 | ) |  | $ | (26.0 | )
At December 31, 2012, Bio-Rad’s international subsidiaries had combined net operating loss carryforwards of $99.6 million. Of these loss carryforwards, $97.7 million have no expiration date. We believe that it is more likely than not that the benefit from most of these net operating loss carryforwards will not be realized. We have provided a valuation allowance of $25.6 million relating to these net operating loss carryforwards. At December 31, 2012, Bio-Rad had U.S. Federal net operating loss carryforwards of approximately $36 million as a result of acquisitions. These carryforwards are subject to limitation on their utilization and will expire between 2018 and 2030. At December 31, 2012, Bio-Rad had U.S. Federal research tax credit carryforwards of $1.5 million, which are subject to limitations on their utilization. At December 31, 2012, Bio-Rad had approximately $53 million of California net operating loss carryforwards related to the acquisition of QuantaLife. We believe that it is more likely than not that the benefit from these net operating loss carryforwards will not be realized and have recorded a full valuation allowance against these losses. At December 31, 2012, Bio-Rad had a deferred tax asset of $17.2 million relating to California research tax credit carryforwards, including $1.1 million from the acquisition of QuantaLife, which may be carried forward indefinitely. Based on our judgment and consistent with prior years, we have recorded a full valuation allowance against the deferred tax asset. We believe that it is more likely than not that certain of these deferred tax assets described above will not be realized in the foreseeable future. If or when recognized, the tax benefits relating to any reversal of the valuation allowance on deferred tax assets at December 31, 2012 will be recognized as a reduction of income tax expense. The following table summarizes at December 31, 2012 the tax years that are either currently under audit or remain open and subject to examination by tax authorities in the major jurisdictions that Bio-Rad operates:
U.S. | 2009-2012
Canada | 2007-2012
France | 2008-2012
Germany | 2008-2012
Italy | 2008-2012
Japan | 2009-2012
Switzerland | 2010-2012
The following is a tabular reconciliation of the total amounts of unrecognized tax benefits (in millions):
|  | 2012 |  | 2011 |  | 2010
Unrecognized tax benefits – January 1 |  | $ | 12.9 |  |  | $ | 20.6 |  |  | $ | 17.5 |
Additions to tax positions related to prior years |  | 1.3 |  |  | 1.2 |  |  | 4.1 |
Reductions to tax positions related to prior years |  | (1.1 | ) |  | (0.4 | ) |  | (0.1 | )
Additions to tax positions related to the current year |  | 2.2 |  |  | 2.1 |  |  | 3.3 |
Settlements |  | — |  |  | (5.2 | ) |  | (0.1 | )
Lapse of statute of limitations |  | (3.0 | ) |  | (5.1 | ) |  | (4.1 | )
Acquisitions |  | 2.2 |  |  | — |  |  | — |
Currency translation |  | — |  |  | (0.3 | ) |  | — |
Unrecognized tax benefits – December 31 |  | $ | 14.5 |  |  | $ | 12.9 |  |  | $ | 20.6 |
Substantially all our unrecognized tax benefits at December 31, 2012, 2011 and 2010 would affect the effective tax rate if recognized. Bio-Rad recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. Related to the unrecognized tax benefits noted above, Bio-Rad has accrued interest of $2.0 million and $2.1 million as of December 31, 2012 and 2011, respectively. At December 31, 2012, we believe that it is reasonably possible that $3.7 million of our unrecognized tax benefits may be recognized by the end of 2013 as a result of statute lapses. These benefits are related to uncertainty regarding sustainability of certain deductions and credits for tax years that remain subject to examination by the relevant tax authorities. In general, it is our practice and intention to reinvest the earnings of our non-U.S. subsidiaries in their operations. As of December 31, 2012, Bio-Rad had not made a provision for U.S. or additional foreign withholding taxes on approximately $484 million of the excess of the amount for financial reporting over the tax basis of investments in foreign subsidiaries that are essentially permanent in duration. Generally, such amounts become subject to U.S. taxation upon remittance of dividends and under certain other circumstances. If these earnings were repatriated to the U.S., the deferred tax liability associated with these temporary differences would be approximately $102 million.

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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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 136, 172 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph h -Article 4 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 43, 44, 45, 46, 47, 48, 49 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32537-109319 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32559-109319 + Details
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