Income Tax

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Income Tax

10.  INCOME TAXES

The components of income (loss) before income tax are as follows (in thousands):

	For the Years Ended December 31,
	2020			2019		2018
United States	$	(45,167	)	$	61,374	$	61,680
Other countries		(46,010	)		20,620		43,614
Income (loss) before income tax	$	(91,177	)	$	81,994	$	105,294

The components of income tax expense are as follows (in thousands):

	For the Years Ended December 31,
	2020			2019			2018
Current:
United States	$	5,181		$	8,786		$	13,198
Other countries		11,926			13,267			10,132
State and provincial		618			(28	)		1,548
Total current		17,725			22,025			24,878
Deferred:
United States		(69	)		(57,250	)		(1,340	)
Other countries		(11,144	)		23,558			1,909
State and provincial		(616	)		(623	)		—
Total deferred		(11,829	)		(34,315	)		569
Income tax expense (benefit)	$	5,896		$	(12,290	)	$	25,447

The differences in income tax expense (benefit) computed using the Netherlands statutory income tax rate of 25% and our income tax expense (benefit) as reported in the accompanying consolidated statements of operations are as follows (in thousands):

	For the Years Ended December 31,
	2020			2019			2018
Tax at the Netherlands income tax rate	$	(23,005	)	$	22,895		$	26,189
International earnings taxed at rates other than the    Netherlands statutory rate		14,986			(1,343	)		(14,997	)
Non-deductible expenses		2,977			3,516			4,452
Change in valuation allowance		23			(3,491	)		1,513
State and provincial taxes		(227	)		(825	)		1,566
Tax credits		(5,975	)		(3,893	)		(3,939	)
Benefit from corporate restructuring		—			(59,336	)		—
Unremitted earnings of subsidiaries		418			26,126			—
Adjustments of prior year taxes		545			(1,684	)		2,350
Adjustments of income tax reserves		(1,965	)		1,084			(1,613	)
Non-deductible goodwill impairment		15,547			—			—
Foreign exchange		226			2,014			5,936
Accrued withholding taxes		2,092			2,603			2,911
Other		254			44			1,079
Income tax expense (benefit)	$	5,896		$	(12,290	)	$	25,447

Deferred tax assets and liabilities result from various temporary differences between the financial statement carrying amount and their tax basis. Deferred tax assets and liabilities are summarized as follows (in thousands):

	December 31,
	2020			2019
Deferred tax assets:
Net operating loss carry-forwards	$	13,892		$	7,209
Tax credit carry-forwards		2,996			1,888
Accruals for compensation		8,587			8,240
Accruals for inventory capitalization		3,445			1,788
Unrealized benefit from corporate restructuring		53,501			56,985
Intangibles		830			—
Unrealized benefit plan loss		2,366			3,740
Unrealized foreign exchange		2,852			3,842
Unearned revenue		741			1,849
Other		1,989			1,839
Total deferred tax assets		91,199			87,380
Valuation allowance		(6,264	)		(6,241	)
Net deferred tax assets		84,935			81,139
Deferred tax liabilities:
Intangibles		—			(6,263	)
Property, plant and equipment		(4,998	)		(3,546	)
Accrued interest		—			(1,679	)
Accrued withholding taxes		(26,916	)		(26,718	)
Unrealized foreign exchange		(610	)		(2,653	)
Other		(221	)		(306	)
Total deferred tax liabilities		(32,745	)		(41,165	)
Net deferred income taxes	$	52,190		$	39,974

	December 31,
	2020			2019
Long-term deferred tax assets	$	72,775		$	67,312
Long-term deferred tax liabilities		(20,585	)		(27,338	)
Total deferred tax assets (liabilities)	$	52,190		$	39,974

At December 31, 2020, we had tax net operating loss carry-forwards in various tax jurisdictions of $62.3 million. Although we cannot be certain that these operating loss carry-forwards will be utilized, we anticipate that we will have sufficient taxable income in future years to allow us to fully utilize the carry-forwards that are not subject to a valuation allowance. As of December 31, 2020, if unused, $11.2 million will expire between 2021 and 2023, $5.2 million will expire between 2024 and 2026, $7.0 million will expire between 2027 and 2030 and $15.9 million will expire beyond 2031. The remaining balance of $23.0 million is not subject to expiration. During 2020, we have no net operating loss carry-forwards, which carried a full valuation allowance, that expired unused.

We file income tax returns in the U.S. federal jurisdiction, various states and foreign jurisdictions. We are currently undergoing multiple examinations in various jurisdictions, and the years 2009 through 2019 remain open for examination in various tax jurisdictions in which we operate. The ultimate settlement and timing of these additional tax assessments is uncertain but the Company will continue to vigorously defend its return filing position and does not view the assessments as probable at this time.

During 2020, adjustments were made to estimates for uncertain tax positions in certain tax jurisdictions based upon changes in facts and circumstances, resulting in a reduction to the unrecognized tax benefits. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands):

	For the Years Ended December 31,
	2020			2019			2018
Unrecognized tax benefits at January 1,	$	7,301		$	7,471		$	10,124
Tax positions, current period		1,650			495			543
Tax positions, prior period		(491	)		(361	)		(304	)
Settlements with taxing authorities		(2,159	)		(18	)		(2,207	)
Lapse of applicable statute of limitations		(46	)		(286	)		(685	)
Unrecognized tax benefits at December 31,	$	6,255		$	7,301		$	7,471

Our policy is to record accrued interest and penalties on uncertain tax positions, net of any tax effect, as part of total tax expense for the period. The corresponding liability is carried along with the tax exposure as a non-current payable in Other Long-term Liabilities. For the years ended December 31, 2020, 2019 and 2018, we recognized $0.9 million, $1.3 million and $0.6 million, respectively, in interest and penalties. For the years ended December 31, 2020, 2019 and 2018, we had $4.2 million, $5.1 million and $3.9 million, respectively, accrued for the payment of interest and penalties. Changes in our estimate of unrecognized tax benefits would affect our effective tax rate. As of December 31, 2020, 2019 and 2018 there are $0.5 million, $0.9 million and $0.6 million, respectively, of unrecognized tax benefits that could be resolved within the next twelve months which could have a positive effect on the annual effective tax rate.