Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

U.S. and foreign income before income taxes consist of the following (in millions):

The income tax provision (benefit) related to income before income taxes consists of the following components (in millions):



	2017			2016			2015
Current:
U.S. federal statutory tax	$	94.6		$	7.5		$	(9.9	)
State	5.6			0.8			0.7
Foreign	34.2			30.4			27.0
	134.4			38.7			17.8
Deferred:
U.S. federal statutory tax	15.1			(29.3		)	4.6
State	8.9			(4.2		)	3.0
Foreign	(10.0		)	(2.5		)	(2.3		)
	13.9			(36.0		)	5.3
Non-current tax expense (income)	0.9			13.0			24.1
	$	149.2		$	15.7		$	47.2

A reconciliation of the U.S. federal statutory income tax rate to our effective income tax rate is as follows:



	2017		2016		2015
U.S. federal statutory tax rate	35.0	%	35.0	%	35.0	%
Foreign earnings, net of foreign taxes	245.4		(42.4	)	(28.3	)
State income taxes, net of U.S. federal income tax benefit	(51.8	)	(1.5	)	1.1
U.S. tax on deemed dividends	(14.0	)	1.3		1.7
Tax Act impact	(704.3	)	—		—
Deferred tax impact on foreign unrepatriated earnings	(65.5	)	—		—
Goodwill impairment	(81.5	)	—		—
Sale of subsidiary	—		3.8		—
Uncertain tax positions	(4.1	)	9.2		10.3
Tax authority settlements	(10.0	)	—		—
Nontaxable interest income	36.9		—		—
Nondeductible interest expense	(12.6	)	—		—
Valuation allowance	(19.6	)	2.0		0.3
Other permanent differences	(61.0	)	3.6		1.6
Effective income tax rate	(707.1	)%	11.0	%	21.7	%

The temporary differences which comprise our net deferred tax liabilities are as follows (in millions):



	As of December 31,
	2017			2016
Gross Deferred Tax Assets:
Bad debt reserve	$	3.5		$	4.5
Net operating loss	23.0			38.6
Accrued and other share-based compensation	18.8			26.2
Accrued expenses	11.7			5.0
U.S. foreign income tax credits	—			7.8
Other income tax credits	0.2			0.2
Customer deposits	1.9			6.3
Investments	1.3			—
Cash flow hedges	3.2			4.6
Total gross deferred tax assets	63.7			93.2
Less: Valuation allowance	24.6			7.1
Gross deferred tax assets, net of valuation allowance	39.1			86.1
Deferred Tax Liabilities:
Depreciation	(6.4		)	(8.5		)
Goodwill and intangible assets	(43.6		)	(56.1		)
Unrealized foreign exchange	(0.9		)	(8.0		)
Prepaid expenses, deductible for tax purposes	(3.8		)	(5.8		)
Deferred tax costs on foreign unrepatriated earnings	(13.8		)	—
Unrealized derivatives	(1.1		)	(2.4		)
Other	(1.1		)	(0.7		)
Total gross deferred tax liabilities	(70.8		)	(81.5		)
Net deferred tax liability	$	31.7		$	—
Net deferred tax asset	—			4.6
Reported on the consolidated balance sheets as:
Identifiable intangible and other non-current assets for deferred tax assets, non-current	$	12.8		$	20.6

Non-current income tax liabilities, net for deferred tax liabilities, non-current	$	44.5		$	16.0

This deferred tax asset expires as follows (in millions):

The following is a tabular reconciliation of the total amounts of gross unrecognized income tax liabilities for the year (in millions):



	2017			2016			2015
Gross Unrecognized Tax Liabilities – opening balance	$	62.2		$	47.8		$	24.3
Gross increases – tax positions in prior period	10.9			19.7			9.2
Gross decreases – tax positions in prior period	—			(15.4		)	(4.8		)
Gross increases – tax positions in current period	10.7			12.9			22.0
Gross decreases – tax positions in current period	—			—			—
Settlements	(23.0		)	—			—
Lapse of statute of limitations	(2.1		)	(2.8		)	(2.9		)
Gross Unrecognized Tax Liabilities – ending balance	$	58.8		$	62.2		$	47.8

The following table summarizes these open tax years by jurisdiction with major uncertain tax positions:



	Open Tax Year
Jurisdiction	Examination in progress	Examination not yet initiated
United States	2013 - 2016	2017
Korea	2011 - 2014	2015 - 2017
United Kingdom	2013 - 2015	2016 - 2017
The Netherlands	None	2013 - 2017
Greece	None	2012 - 2017
Denmark	2013 - 2015	2016 - 2017