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Income Taxes
9 Months Ended
Sep. 30, 2016
Income Taxes [Abstract]  
Income Taxes Disclosure







7.  INCOME TAXES 



The total amount of unrecognized benefit that would affect the effective tax rate, if recognized, was approximately $5 million as of September 30, 2016. A total of approximately $3 million of interest and penalties is included in the amount of the liability for uncertain tax positions at September 30, 2016. It is the Company’s policy to recognize interest and penalties related to unrecognized benefits in its condensed consolidated statements of income as income tax expense.



It is possible the amount of unrecognized tax benefit could change in the next 12 months as a result of a lapse of the statute of limitations and settlements with taxing authorities; however, the Company does not anticipate the change will have a material impact on the Company’s condensed consolidated results of operations or condensed consolidated financial position.





The Company, or one of its subsidiaries, files income tax returns in the United States federal jurisdiction and various state jurisdictions. The Company has extended the federal statute of limitations through March 31, 2017 for Triad Hospitals, Inc. for the tax periods ended December 31, 1999, December 31, 2000, April 30, 2001, June 30, 2001, December 31, 2001, December 31, 2002, December 31, 2003, December 31, 2004, December 31, 2005, December 31, 2006 and July 25, 2007. With few exceptions, the Company is no longer subject to state income tax examinations for years prior to 2011. The Company’s federal income tax returns for the 2009 and 2010 tax years are currently under examination by the Internal Revenue Service. The Company believes the results of these examinations will not be material to its consolidated results of operations or consolidated financial position. The Company has extended the federal statute of limitations through January 31, 2018 for Community Health Systems, Inc. for the tax periods ended December 31, 2007, 2008, 2009 and 2010, and through March 31, 2017 for the tax periods ended December 31, 2011 and 2012.



The Company’s effective tax rates were 34.9% and 31.3% for the three months ended September 30, 2016 and 2015, respectively, and 9.0% and 33.3% for the nine months ended September 30, 2016 and 2015, respectively. The increase in the Company’s effective tax rate for the three months ended September 30, 2016, when compared to the three months ended September 30, 2015, was primarily due to a decrease in pre-tax income for the three months ended September 30, 2016 with relatively no change in net income attributable to noncontrolling interests. Including the net income attributable to noncontrolling interests, which is not tax affected in the condensed consolidated statement of income, the effective tax rate for the three months ended September 30, 2016 and 2015 would have been 27.4% and 38.8%, respectively. This decrease and the decrease in the Company’s effective tax rate for the nine months ended September 30, 2016, when compared to the nine months ended September 30, 2015, was primarily due to the non-deductible nature of goodwill written off for impairment and divestitures, as well as the non-deductible nature of certain costs incurred to complete the spin-off of QHC.



Cash paid for income taxes, net of refunds received, resulted in net cash paid of $2 million and $1 million during the three months ended September 30, 2016 and 2015, respectively, and net cash paid of $6 million and $10 million during the nine months ended September 30, 2016 and 2015, respectively.