XML 55 R18.htm IDEA: XBRL DOCUMENT
v3.10.0.1

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2018
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes Income tax provision (benefit) applicable to continuing operations consists of the following:
| Year ended December 31,
(in thousands) | 2018 |  | 2017 |  | 2016
Current: |  |  |  |  |
Federal | $ | (549 | ) |  | $ | (1,668 | ) |  | $ | (702 | )
State and local | 323 |  |  | 643 |  |  | 199 |
Foreign | 1,138 |  |  | 1,125 |  |  | 1,385 |
| $ | 912 |  |  | $ | 100 |  |  | $ | 882 |
Deferred: |  |  |  |  |
Federal | $ | 10,073 |  |  | $ | (61,655 | ) |  | $ | 3,523 |
State and local | 578 |  |  | (2,107 | ) |  | 1,696 |
Foreign | 367 |  |  | 528 |  |  | 810 |
| $ | 11,018 |  |  | $ | (63,234 | ) |  | $ | 6,029 |
Total: |  |  |  |  |
Federal | $ | 9,525 |  |  | $ | (63,323 | ) |  | $ | 2,821 |
State and local | 901 |  |  | (1,464 | ) |  | 1,895 |
Foreign | 1,505 |  |  | 1,653 |  |  | 2,195 |
| $ | 11,931 |  |  | $ | (63,134 | ) |  | $ | 6,911 |
Income (loss) before income taxes from continuing operations consists of the following:
| Year ended December 31,
(in thousands) | 2018 |  | 2017 |  | 2016
U.S. | $ | 46,678 |  |  | $ | (25,645 | ) |  | $ | 11,526 |
Foreign | 6,478 |  |  | 5,120 |  |  | 9,855 |
| $ | 53,156 |  |  | $ | (20,525 | ) |  | $ | 21,381 |
A reconciliation from the statutory U.S. federal tax rate to the effective tax rate follows:
| Year ended December 31,
| 2018 |  | 2017 |  | 2016
Statutory U.S. federal tax rate | 21.0 | % |  | 35.0 | % |  | 35.0 | %
Increase (decrease) in rate resulting from: |  |  |  |  |
State and local income taxes, net of related federal taxes | 3.4 |  |  | (4.2 | ) |  | 5.8 |
Federal income tax credits | (3.4 | ) |  | — |  |  | (7.3 | )
Change in federal and state tax rates | (2.1 | ) |  | 374.8 |  |  | — |
Income taxes on foreign earnings | (1.5 | ) |  | (2.2 | ) |  | (1.3 | )
Nondeductible compensation | 1.5 |  |  | (2.5 | ) |  | 2.0 |
Tax effect of GILTI | 1.4 |  |  | — |  |  | — |
Equity Method Investments | 1.1 |  |  | (0.4 | ) |  | 0.3 |
Impacts related to the 2017 Tax Act | 0.6 |  |  | (7.1 | ) |  | — |
Other, net | 0.5 |  |  | 4.4 |  |  | (0.8 | )
Release (accrual) of unrecognized tax benefits | (0.1 | ) |  | 3.0 |  |  | 0.1 |
Effect of noncontrolling interest | 0.1 |  |  | 0.2 |  |  | (4.7 | )
Goodwill impairment | — |  |  | (93.5 | ) |  | — |
Tax associated with accrued and unpaid dividends | — |  |  | 0.1 |  |  | 3.2 |
Effective tax rate | 22.5 | % |  | 307.6 | % |  | 32.3 | %
Net income tax refunds of $5.4 million were received in 2018, net income taxes of $2.1 million were paid in 2017, and net income tax refunds of $10.6 million were received in 2016.Significant components of the Company's deferred tax liabilities and assets are as follows:
| December 31,
(in thousands) | 2018 |  | 2017
Deferred tax liabilities: |  |  |
Property, plant and equipment and Rail Group assets leased to others | $ | (168,345 | ) |  | $ | (129,876 | )
Equity method investments | (24,732 | ) |  | (31,223 | )
Other | (7,999 | ) |  | (8,754 | )
| (201,076 | ) |  | (169,853 | )
Deferred tax assets: |  |  |
Employee benefits | 13,161 |  |  | 15,229 |
Accounts and notes receivable | 2,069 |  |  | 2,317 |
Inventory | 7,595 |  |  | 6,100 |
Federal income tax credits | 13,075 |  |  | 10,225 |
Net operating loss carryforwards | 12,766 |  |  | 5,753 |
Deferred interest (a) | 6,476 |  |  | — |
Lease liability | 8,473 |  |  | — |
Other | 8,839 |  |  | 9,674 |
Total deferred tax assets | 72,454 |  |  | 49,298 |
Valuation allowance | (1,185 | ) |  | (1,024 | )
| 71,269 |  |  | 48,274 |
Net deferred tax liabilities | $ | (129,807 | ) |  | $ | (121,579 | )
(a) The deferred interest tax asset represents disallowed interest deductions under IRC Section 163(j) (Limitation on Deduction for interest on Certain Indebtedness) for the current year. The disallowed interest is able to be carried forward indefinitely and utilized in future years pursuant to IRC Section 163(j)). In December 2017, the 2017 Tax Act was enacted. The 2017 Tax Act includes a number of changes to previous U.S. tax laws that impact the company, most notably a reduction of the U.S. corporate income tax rate from 35 percent to 21 percent for tax years beginning after December 31, 2017. The 2017 Tax Act also provides for a one-time transition tax on certain foreign earnings and the acceleration of depreciation for certain assets placed into service after September 27, 2017 as well as prospective changes which began in 2018, including repeal of the domestic manufacturing deduction, capitalization of research and development expenditures, additional limitations on executive compensation and limitations on the deductibility of interest. The company recognized the income tax effects of the 2017 Tax Act in its financial statements in accordance with Staff Accounting Bulletin (SAB) No. 118, which allowed us to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. As a result, we previously provided a provisional estimate of the effect of the Tax Act in our financial statements. In the fourth quarter of 2018, we completed our analysis to determine the effect of the Tax Act and recorded immaterial adjustments as of December 31, 2018. Beginning in 2018, The Tax Reform Act includes two new U.S. corporate tax provisions, the global intangible low-taxed income (“GILTI”) and the base-erosion and anti-abuse tax (“BEAT”) provisions. The GILTI provision requires the Company to include in its U.S. income tax return non-U.S. subsidiary earnings in excess of an allowable return on the non-U.S. subsidiary’s tangible assets. The Company has elected to treat GILTI as a period cost. The BEAT provision in the Tax Reform Act eliminates the deduction of certain base-erosion payments made to related non-U.S. corporations, and imposes a minimum tax if the amount is greater than the regular tax. The Company evaluated the GILTI and BEAT provision, resulting in a financial statement impact of $0.7 million and zero, respectively, for the year ended December 31, 2018. On December 31, 2018, the Company had $46.6 million, $103.4 million and $0.6 million of U.S. Federal, state and non-U.S. net operating loss carryforwards that begin to expire in 2034, 2019 and 2035, respectively. The Company also has $8.3 million of general business credits that expire after 2036 and $4.5 million of foreign tax credits that begin to expire after 2025. Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. If it is more-likely-than-not that the deferred tax asset will be realized, no valuation allowance is recorded. Management's judgment is required in determining the provision for income taxes, deferred tax assets and liabilities and the valuation allowance recorded against the net deferred tax assets. The valuation allowance would need to be adjusted in the event future taxable income is materially different than amounts estimated. Significant judgments, estimates and factors considered by management in its determination of the probability of the realization of deferred tax assets include: •Historical operating results •Expectations of future earnings •Tax planning strategies; and •The extended period of time over which retirement, medical, and pension liabilities will be paid. During 2018, due to a three-year cumulative loss and future economic uncertainty, we concluded that a valuation allowance was required related to additional State net operating losses. This resulted in an immaterial amount of non-cash charge to income tax expense. The Company or one of its subsidiaries files income tax returns in the U.S., various foreign jurisdictions and various state and local jurisdictions. The Company is no longer subject to examinations by foreign jurisdictions for years before 2013 and is no longer subject to examinations by U.S. tax authorities for years before 2015. The Company is no longer subject to examination by state tax authorities in most states for tax years before 2015. A reconciliation of the January 1, 2016 to December 31, 2018 amount of unrecognized tax benefits is as follows:
(in thousands) |
Balance at January 1, 2016 | $ | 1,431 |
Additions based on tax positions related to the current year | 113 |
Additions based on tax positions related to prior years | — |
Reductions based on tax positions related to prior years | (40 | )
Reductions as a result of a lapse in statute of limitations | (52 | )
Balance at December 31, 2016 | 1,452 |
Additions based on tax positions related to the current year | — |
Reductions based on tax positions related to prior years | (92 | )
Reductions as a result of a lapse in statute of limitations | (573 | )
Balance at December 31, 2017 | 787 |
Additions based on tax positions related to the current year | — |
Additions based on tax positions related to prior years | — |
Reductions based on tax positions related to prior years | — |
Reductions as a result of a lapse in statute of limitations | (169 | )
Balance at December 31, 2018 | $ | 618 |
The Company anticipates $0.1 million decrease in the reserve during the next 12 months due to the settling of state tax appeals and a lapse in statute of limitations. Dependent upon the lapse in statute of limitations and the outcome of the state tax appeals, the total liability for unrecognized tax benefits as of December 31, 2018 could impact the effective tax rate. The Company has elected to classify interest and penalties as Interest expense on the Consolidated Statements of Operations rather than as income tax expense. The Company has $0.3 million accrued for the payment of interest and penalties at December 31, 2018. The net interest and penalties benefit for 2018 is zero, due to decreased uncertain tax positions. The Company had $0.3 million accrued for the payment of interest and penalties at December 31, 2017. The net interest and penalties benefit for 2017 was $0.1 million.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration