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Income Taxes | 3 Months Ended
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Sep. 30, 2018
Income Tax Disclosure [Abstract] |
INCOME TAXES | INCOME TAXES The effective income tax rates for the three months ended September 30, 2018 and 2017 were 24.9 percent and 19.5 percent, respectively. The change is primarily due to (1) U.S. income in the prior year quarter not being tax-effected and current quarter U.S. income being tax-effected now that a valuation allowance is no longer recorded on U.S. deferred tax assets; (2) the reduction in the U.S. federal statutory tax rate, partially offset by the tax on global intangible low-taxed income (GILTI) associated with tax reform effective in fiscal 2019; and (3) an incremental charge in the current quarter to estimate the one-time tax that is imposed on our unremitted foreign earnings (toll tax). Tax Cuts and Jobs Act of 2017 (TCJA) Three items from TCJA that effect the Company for fiscal 2019 are the reduction in the statutory tax rate, the toll tax and GILTI. At this time, the Company does not anticipate a material impact to the fiscal 2019 condensed consolidated financial statements from the base erosion anti-abuse tax (BEAT) or a deduction for foreign-derived intangible income (FDII). In accordance with the SEC Staff Accounting Bulletin 118 (SAB 118), we have accounted for the impacts of TCJA provisions first effective in fiscal 2018 to the extent a reasonable estimate could be made during the three months ended September 30, 2018. We will continue to refine our estimates throughout the measurement period, which will not extend beyond December 22, 2018. The U.S. federal tax rate reduction was effective as of January 1, 2018. As a June 30 fiscal year-end taxpayer, our fiscal 2018 U.S. federal statutory tax rate was a blended rate of 28.1 percent. Our U.S. federal statutory tax rate is 21.0 percent in fiscal 2019. During the three months ended September 30, 2018, we revised our estimate of the toll tax charge primarily related to regulations issued by the U.S. Treasury and the Internal Revenue Service during the quarter. The adjustment resulted in an additional $1.0 million charge, increasing the total toll tax charge to $81.9 million as of September 30, 2018. We estimate a cash payment of $4.5 million associated with the toll charge, which will be paid over a period of eight years. The toll tax charge, in addition to the revaluation of U.S. net deferred taxes, is preliminary and subject to finalization of our 2018 U.S. federal income tax return, applying any additional regulatory guidance issued after September 30, 2018 and changes in the interpretations and assumptions of existing guidance. We consider substantially all of the unremitted earnings of our non-U.S. subsidiaries to be permanently reinvested. As a result of TCJA, we are in the process of re-evaluating our permanent reinvestment assertion in certain jurisdictions. The unremitted earnings and profits of our non-U.S. subsidiaries and affiliates have been subject to U.S. federal income tax, but may remain subject to foreign currency adjustments and state and foreign taxes if repatriated. In accordance with SAB 118, we expect to complete our evaluation by December 22, 2018.

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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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