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Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2016
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The consolidated income tax provision includes taxes attributable to the controlling interest and, to a lesser extent, taxes attributable to non-controlling interests is as follows:
|  | For the Years Ended December 31,
|  | 2014 |  | 2015 |  | 2016
Controlling interests: |  |  |  |  |  |
Current tax |  | $ | 149.8 |  |  | $ | 152.4 |  |  | $ | 168.1 |
Intangible-related deferred taxes |  | 47.8 |  |  | 77.7 |  |  | 84.3 |
Other deferred taxes |  | 34.0 |  |  | 27.7 |  |  | (23.2 | )
Total controlling interests |  | 231.6 |  |  | 257.8 |  |  | 229.2 |
Non-controlling interests: |  |  |  |  |  |  |
Current tax |  | $ | 15.3 |  |  | $ | 9.8 |  |  | $ | 8.2 |
Deferred taxes |  | (0.8 | ) |  | (4.2 | ) |  | (1.8 | )
Total non-controlling interests |  | 14.5 |  |  | 5.6 |  |  | 6.4 |
Provision for income taxes |  | $ | 246.1 |  |  | $ | 263.4 |  |  | $ | 235.6 |
Income before income taxes (controlling interest) |  | $ | 665.5 |  |  | $ | 767.3 |  |  | $ | 702.0 |
Effective tax rate attributable to controlling interests(1) |  | 34.8 | % |  | 33.6 | % |  | 32.6 | %
__________________________
(1) | Taxes attributable to the controlling interest divided by Income before income taxes (controlling interest).
The consolidated provision for income taxes consisted of the following:
|  | For the Years Ended December 31,
|  | 2014 |  | 2015 |  | 2016
Current: |  |  |  |  |  |
Federal |  | $ | 93.8 |  |  | $ | 106.3 |  |  | $ | 103.4 |
State |  | 27.1 |  |  | 18.3 |  |  | 22.9 |
Foreign |  | 44.2 |  |  | 37.6 |  |  | 50.0 |
Total current |  | 165.1 |  |  | 162.2 |  |  | 176.3 |
Deferred: |  |  |  |  |  |
Federal |  | 89.0 |  |  | 103.8 |  |  | 62.3 |
State |  | 2.8 |  |  | 14.8 |  |  | 10.0 |
Foreign |  | (10.8 | ) |  | (17.4 | ) |  | (13.0 | )
Total deferred |  | 81.0 |  |  | 101.2 |  |  | 59.3 |
Provision for income taxes |  | $ | 246.1 |  |  | $ | 263.4 |  |  | $ | 235.6 |
For financial reporting purposes, Income before income taxes consisted of the following:
|  | For the Years Ended December 31,
|  | 2014 |  | 2015 |  | 2016
Domestic |  | $ | 784.1 |  |  | $ | 827.6 |  |  | $ | 688.1 |
International |  | 229.5 |  |  | 263.0 |  |  | 286.5 |
|  | $ | 1,013.6 |  |  | $ | 1,090.6 |  |  | $ | 974.6 |
The following table reconciles the U.S. federal statutory tax rate to the Company’s effective tax rate:
| For the Years Ended December 31,
| 2014 |  | 2015 |  | 2016
Statutory U.S. federal tax rate | 35.0 | % |  | 35.0 | % |  | 35.0 | %
State income taxes, net of federal benefit | 2.3 |  |  | 2.6 |  |  | 2.9 |
Effect of foreign operations(1) | (5.3 | ) |  | (3.5 | ) |  | (4.6 | )
Equity Compensation | 2.5 |  |  | 0.8 |  |  | (0.4 | )
Effect of changes in tax law, rates(2) | — |  |  | (0.8 | ) |  | (0.3 | )
Other | 0.3 |  |  | (0.5 | ) |  | — |
Effective tax rate (controlling interest) | 34.8 | % |  | 33.6 | % |  | 32.6 | %
Effect of income from non-controlling interests | (9.6 | ) |  | (9.2 | ) |  | (8.4 | )
Effective tax rate | 25.2 | % |  | 24.4 | % |  | 24.2 | %
__________________________
(1) | Effect of foreign operations includes the effect of undistributed foreign earnings the Company deems indefinitely reinvested in foreign operations, and the effect of differences in the financial reporting basis over tax basis in the Company’s investments in foreign subsidiaries considered permanent in duration.
(2) | Effect of changes in tax law, rates reflects the impact of the reduction in the UK tax rates in years 2015 and 2016.
Deferred income taxes reflect the expected future tax consequences of temporary differences between the financial reporting basis and tax basis of the Company’s assets and liabilities. The significant components of the Company’s deferred income taxes are as follows:
|  | December 31,
|  | 2015 |  | 2016
Deferred Tax Assets |  |  |  |
Deferred compensation |  | $ | 30.5 |  |  | $ | 34.1 |
State net operating loss carryforwards |  | 17.1 |  |  | 17.4 |
Foreign loss carryforwards |  | 12.3 |  |  | 14.6 |
Tax benefit of uncertain tax positions |  | 14.6 |  |  | 12.1 |
Foreign tax credits |  | — |  |  | 10.0 |
Accrued expenses |  | 4.4 |  |  | 3.9 |
Total deferred tax assets |  | 78.9 |  |  | 92.1 |
Valuation allowance |  | (20.5 | ) |  | (22.1 | )
Deferred tax assets, net of valuation allowance |  | $ | 58.4 |  |  | $ | 70.0 |
Deferred Tax Liabilities |  |  |  |
Intangible asset amortization |  | $ | (320.2 | ) |  | $ | (396.8 | )
Non-deductible intangible amortization |  | (109.8 | ) |  | (177.0 | )
Convertible securities interest |  | (99.8 | ) |  | (109.0 | )
Deferred income |  | (92.8 | ) |  | (47.2 | )
Other |  | (1.5 | ) |  | (0.8 | )
Total deferred tax liabilities |  | (624.1 | ) |  | (730.8 | )
Net deferred tax liability |  | $ | (565.7 | ) |  | $ | (660.8 | )
At December 31, 2016, the Company had available state net operating loss carryforwards of $489.7 million, which will expire over a 19-year period. At December 31, 2016, the Company had foreign loss carryforwards of $55.1 million, of which $47.7 million will expire over a 20-year period and the balance will carry forward indefinitely. At December 31, 2016, the Company had foreign tax credits of $10.0 million, which will expire in 2026. The Company believes that it is more-likely-than-not that the benefit from a portion of the state and foreign loss carryforwards will not be realized and has, therefore, recorded a valuation allowance of $22.1 million on the deferred tax assets related to these state and foreign loss carryforwards. For the years ended December 31, 2015 and 2016, the Company increased its valuation allowance $2.1 million and $1.6 million, respectively, related to an increase in the loss carryforwards that are not expected to be realized. The Company does not provide for U.S. income taxes on the excess of the financial reporting basis over tax basis in the Company’s investments in foreign subsidiaries considered permanent in duration. Such amount would generally become taxable upon the repatriation of assets from, or a sale or liquidation of, the subsidiaries. As of December 31, 2016, the amount of such difference was $222.9 million. The Company also considers certain undistributed earnings of a foreign subsidiary to be indefinitely reinvested and, accordingly, has not provided U.S. income taxes on these earnings. As of December 31, 2016, the cumulative amount of indefinitely reinvested foreign earnings was $65.0 million. Determination of the potential amount of unrecognized deferred U.S. income tax liability related to these amounts is not practicable because of the numerous assumptions associated with this hypothetical calculation. However, foreign tax credits would be available to reduce some portion of the deferred U.S. income tax liability. A reconciliation of the changes in unrecognized tax benefits is as follows:
|  | For the Years Ended December 31,
|  | 2014 |  | 2015 |  | 2016
Balance, as of January 1 |  | $ | 20.4 |  |  | $ | 28.8 |  |  | $ | 26.9 |
Additions based on current year tax positions |  | 2.6 |  |  | 2.2 |  |  | 3.8 |
Additions based on prior years’ tax positions |  | 10.8 |  |  | 1.6 |  |  | 0.6 |
Reductions related to lapses of statutes of limitations |  | (4.1 | ) |  | (4.3 | ) |  | (4.7 | )
Additions (reductions) related to foreign exchange rates |  | (0.9 | ) |  | (1.4 | ) |  | 0.2 |
Balance, as of December 31 |  | $ | 28.8 |  |  | $ | 26.9 |  |  | $ | 26.8 |
Included in the balance of unrecognized tax benefits at December 31, 2014, 2015 and 2016 are $26.4 million, $25.3 million, and $26.0 million, respectively, of tax benefits that, if recognized, would favorably affect the Company’s effective tax rate. The Company records accrued interest and penalties, if any, related to unrecognized tax benefits in Income taxes. The Company had $1.6 million, $1.8 million and $1.4 million in interest related to unrecognized tax benefits accrued at December 31, 2014, 2015 and 2016, respectively, which are included in the table above. For the years ended December 31, 2014, 2015 and 2016, no significant interest or penalties were recorded in Income taxes. The Company is subject to U.S. federal, state and local, and foreign income tax in multiple jurisdictions. The Company is also periodically subject to tax examinations in these jurisdictions. The completion of examinations may result in the payment of additional taxes and/or the recognition of tax benefits. The Company is generally no longer subject to income tax examinations by U.S. federal, state and local, or foreign taxing authorities for periods prior to 2011. The Company does not expect any significant changes to its liability for tax benefits during the next twelve months.

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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 Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: 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=65882285&loc=d3e32559-109319 Reference 3: 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=65882285&loc=d3e32718-109319 Reference 4: 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=65882285&loc=d3e32639-109319 Reference 5: 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=65882285&loc=d3e32537-109319 + Details
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