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Income Taxes | 12 Months Ended
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Dec. 31, 2024
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes
(In thousands) | 2024 |  | 2023 |  | 2022
Components of income before income taxes |  |  |  |  |
U.S. income | $ | 243,129 |  |  | $ | 80,229 |  |  | $ | 170,426 |
Non-U.S. income | 131,877 |  |  | 126,459 |  |  | 68,107 |
Income before income taxes | $ | 375,006 |  |  | $ | 206,688 |  |  | $ | 238,533 |
Provision for income taxes |  |  |  |  |
Current |  |  |  |  |
Federal | $ | 47,060 |  |  | $ | 49,642 |  |  | $ | 26,022 |
State | 12,868 |  |  | 9,510 |  |  | 7,708 |
Non-U.S. | 30,209 |  |  | 27,101 |  |  | 20,002 |
Total current provision | $ | 90,137 |  |  | $ | 86,253 |  |  | $ | 53,732 |
Deferred |  |  |  |  |
Federal | $ | (3,141) |  |  | $ | 54,272 |  |  | $ | 7,350 |
State | 1,046 |  |  | 12,914 |  |  | 862 |
Non-U.S. | 1,997 |  |  | (5,334) |  |  | (3,041) |
Total deferred provision (benefit) | (98) |  |  | 61,852 |  |  | 5,171 |
Provision for income taxes | $ | 90,039 |  |  | $ | 148,105 |  |  | $ | 58,903 |
Reconciliation of the U.S. federal income tax rates to our effective tax rate:
| 2024 |  | 2023 |  | 2022
U.S. federal income tax rate | 21.0 | % |  | 21.0 | % |  | 21.0 | %
State income taxes-U.S. | 2.9 | % |  | 3.7 | % |  | 2.9 | %
Taxes on non-U.S. income | 1.1 | % |  | (0.6) | % |  | 0.1 | %
Nondeductible compensation | 0.5 | % |  | 1.9 | % |  | 1.2 | %
Divestiture (Note 20) | — | % |  | 46.6 | % |  | — | %
Valuation allowances | (1.2) | % |  | (0.2) | % |  | 0.8 | %
Research and development credit | (0.7) | % |  | (0.8) | % |  | (0.4) | %
Employee share-based payments | (0.2) | % |  | (0.4) | % |  | (0.8) | %
Taxes on non-U.S. income - U.S., Canadian & European reorganization | (0.1) | % |  | (0.5) | % |  | — | %
Foreign exchange on entity closures | (0.1) | % |  | — | % |  | 0.3 | %
Other | 0.8 | % |  | 0.9 | % |  | (0.4) | %
Effective income tax rate | 24.0 | % |  | 71.6 | % |  | 24.7 | %
Components of deferred tax assets and liabilities:
| December 31,
(In thousands) | 2024 |  | 2023
Deferred tax assets |  |  |
Capitalized research and development | $ | 31,030 |  |  | $ | 28,822 |
Inventory | 9,434 |  |  | 7,281 |
Net operating losses and tax credit carryforwards | 6,715 |  |  | 10,964 |
Share-based compensation | 6,149 |  |  | 5,528 |
Accrued expenses and other reserves | 5,006 |  |  | 4,566 |
Reserve for doubtful accounts | 1,071 |  |  | 1,562 |
Other | 2,177 |  |  | 1,944 |
Total deferred tax assets | 61,582 |  |  | 60,667 |
Valuation allowances | (4,815) |  |  | (9,671) |
Net deferred tax assets | 56,767 |  |  | 50,996 |
Deferred tax liabilities |  |  |
Goodwill and intangibles | (79,917) |  |  | (77,171) |
Employee benefits | (41,399) |  |  | (24,958) |
Property, plant and equipment | (15,461) |  |  | (15,541) |
Other | (1,501) |  |  | (2,680) |
Total deferred tax liabilities | (138,278) |  |  | (120,350) |
Net deferred taxes | $ | (81,511) |  |  | $ | (69,354) |
At December 31, 2024, we had net operating loss carryforwards of approximately $26.9 million. All net operating loss carryforwards without a valuation allowance may be carried forward for a period of at least six years. A reconciliation of the change in the tax liability for unrecognized tax benefits for the years ended December 31, 2024 and 2023 is as follows:
(In thousands) | 2024 |  | 2023
Beginning balance | $ | 3,084 |  |  | $ | 5,192 |
Adjustments for tax positions related to the current year | 51 |  |  | — |
Adjustments for tax positions related to prior years | (607) |  |  | (1,116) |
Settlements | (929) |  |  | — |
Statute expiration | (329) |  |  | (992) |
Ending balance | $ | 1,270 |  |  | $ | 3,084 |
The total amount of unrecognized tax benefits, if recognized, would reduce our future effective tax rate. We have no recognized tax benefits associated with these liabilities in 2024 and recognized $0.6 million of tax liabilities associated with these liabilities in 2023. We recognize interest related to unrecognized tax benefits in interest expense and penalties in operating expenses. Our liability for accrued interest and penalties related to uncertain tax positions was $0.2 million at both December 31, 2024 and 2023. We are subject to regular review and audit by both foreign and domestic tax authorities. While we believe our tax positions will be sustained, the final outcome of tax audits and related litigation may differ materially from the tax amounts recorded in our consolidated financial statements. We file a U.S. federal income tax return along with various state and foreign income tax returns. Examinations of our U.S. federal returns have been completed through 2018. Various state and foreign income tax returns may be subject to tax audits for periods after 2016. On August 16, 2022, President Biden signed the Inflation Reduction Act, which includes a new minimum tax on certain large corporations and an excise tax on stock buybacks. We do not anticipate this legislation will have a material impact for the company. The Organization for Economic Co-operation and Development (OECD) has a framework to implement a global minimum corporate tax of 15% for companies with global revenues above €750.0 million (referred to as Pillar 2), with effective dates beginning in January 2024. We meet the overall revenue threshold and fall within the scope of Pillar 2 and as such, have complied with the requirements of the legislation for the year ended December 31, 2024. The application of Pillar 2 resulted in additional tax expense of $1.1 million.

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