Income Taxes (Tables)

12 Months Ended

Dec. 31, 2013

Income from continuing operations before income taxes and income taxes are as follows:



(In Thousands)	2013			2012			2011
Income from continuing operations before income taxes:
Domestic	$	37,380		$	35,488		$	29,491
Foreign	15,552			26,016			9,298
Total	$	52,932		$	61,504		$	38,789
Current income taxes:
Federal	$	15,988		$	10,905		$	2,958
State	1,416			796			639
Foreign	4,737			7,372			4,500
Total	22,141			19,073			8,097
Deferred income taxes:
Federal	(2,933		)	1,212			3,243
State	(852		)	163			(211		)
Foreign	(1,361		)	(2,129		)	(885		)
Total	(5,146		)	(754		)	2,147
Total income taxes	$	16,995		$	18,319		$	10,244

The significant differences between the U.S. federal statutory rate and the effective income tax rate for continuing operations are as follows:



	Percent of Income Before Income Taxes for Continuing Operations
	2013		2012		2011
Income tax expense at federal statutory rate	35.0		35.0		35.0
Tax contingency accruals and tax settlements	2.0		(0.5	)	0.3
Unremitted earnings from foreign operations	0.9		0.6		1.8
Valuation allowance for capital loss carry-forwards	0.8		1.9		0.9
Non-deductible expenses	0.6		0.3		0.8
Valuation allowance for foreign operating loss carry-forwards	0.5		(0.1	)	1.4
State taxes, net of federal income tax benefit	0.1		1.1		1.7
Non-deductible acquisition expenses	—		—		3.5
Deduction for divestiture of subsidiary stock	—		—		(15.3	)
Research and development tax credit	(0.4	)	—		(1.0	)
Changes in estimates related to prior year tax provision	(0.6	)	(0.5	)	(0.1	)
Foreign rate differences	(0.7	)	(0.6	)	(0.7	)
Domestic Production Activities Deduction	(1.4	)	(0.6	)	—
Tax incentive	(4.7	)	(7.0	)	(1.8	)
Other	—		0.2		(0.1	)
Effective income tax rate	32.1		29.8		26.4

Deferred tax liabilities and deferred tax assets at December 31, 2013 and 2012, are as follows:



(In Thousands)	2013		2012
Deferred tax liabilities:
Amortization of goodwill	$	47,521	$	47,956
Depreciation	29,994		34,110
Foreign currency translation gain adjustment	8,620		8,795
Derivative financial instruments	432		568
Total deferred tax liabilities	86,567		91,429
Deferred tax assets:
Pensions	14,813		30,488
Employee benefits	11,124		10,532
Excess capital losses and book/tax basis differences on investments	4,316		4,923
Asset write-offs, divestitures and environmental accruals	3,734		3,234
Inventory	2,292		2,086
Tax benefit on state and foreign NOL and credit carryforwards	1,871		1,676
Allowance for doubtful accounts	639		756
Timing adjustment for unrecognized tax benefits on uncertain tax positions, including portion relating to interest and penalties	600		236
Other	2,030		974
Deferred tax assets before valuation allowance	41,419		54,905
Less: Valuation allowance	20,019		18,635
Total deferred tax assets	21,400		36,270
Net deferred tax liability	$	65,167	$	55,159
Included in the balance sheet:
Noncurrent deferred tax liabilities in excess of assets	$	70,795	$	60,773
Current deferred tax assets in excess of liabilities	5,628		5,614
Net deferred tax liability	$	65,167	$	55,159

A reconciliation of our unrecognized uncertain tax positions since January 1, 2011, is shown below:



	Years Ended December 31,
(In Thousands)	2013		2012			2011
Balance at beginning of period	$	910	$	1,025		$	1,065
Increase (decrease) due to tax positions taken in:
Current period	643		432			185
Prior period	686		(21		)	10
Increase (decrease) due to settlements with taxing authorities	—		(398		)	—
Reductions due to lapse of statute of limitations	—		(128		)	(235		)
Balance at end of period	$	2,239	$	910		$	1,025

Additional information related to our unrecognized uncertain tax positions since January 1, 2011 is summarized below:



	Years Ended December 31,
(In Thousands)	2013			2012			2011
Gross unrecognized tax benefits on uncertain tax positions (reflected in current income tax and other noncurrent liability accounts in the balance sheet)	$	2,239		$	910		$	1,025
Deferred income tax assets related to unrecognized tax benefits on uncertain tax positions (reflected in deferred income tax accounts in the balance sheet)	(540		)	(212		)	(219		)
Net unrecognized tax benefits on uncertain tax positions, which would impact the effective tax rate if recognized	1,699			698			806
Interest and penalties accrued on deductions taken relating to uncertain tax positions (approximately $100, $(300) and $200 reflected in income tax expense in the income statement in 2013, 2012 and 2011, respectively, with the balance shown in current income tax and other noncurrent liability accounts in the balance sheet)	156			60			373
Related deferred income tax assets recognized on interest and penalties	(60		)	(23		)	(141		)
Interest and penalties accrued on uncertain tax positions net of related deferred income tax benefits, which would impact the effective tax rate if recognized	96			37			232
Total net unrecognized tax benefits on uncertain tax positions reflected in the balance sheet, which would impact the effective tax rate if recognized	$	1,795		$	735		$	1,038