Income Taxes

9 Months Ended

Sep. 30, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

Our provision for income taxes on a consolidated basis was $133.5 million for the three months ended September 30, 2021 as compared to $49.1 million for the three months ended September 30, 2020. The increase of $84.4 million is primarily related to the corresponding increase in our consolidated pre-tax book income. Our effective tax rate increased to 23.4% for the three months ended September 30, 2021 from 21.0% for the three months ended September 30, 2020 primarily resulting from an increase in unfavorable permanent book tax differences and a decrease of tax credits in 2021.

Our provision for income taxes on a consolidated basis was $343.3 million for the nine months ended September 30, 2021 as compared to $119.0 million for the nine months ended September 30, 2020. The increase of $224.2 million is primarily related to the corresponding increase in consolidated pre-tax book income. Our effective tax rate increased to 23.0% for the nine months ended September 30, 2021 from 21.3% for the nine months ended September 30, 2020 primarily resulting from an increase in unfavorable permanent book tax differences and a decrease of tax credits in 2021.

Our effective tax rate for the three and nine months ended September 30, 2021 was different than the U.S. federal statutory tax rate of 21.0% primarily due to U.S. state taxes and impact of permanent book tax differences.

As of September 30, 2021 and December 31, 2020, the company had gross unrecognized tax benefits of $182.6 million and $168.5 million, respectively. The net increase of $14.1 million primarily resulting from an accrual of gross unrecognized tax benefits of $19.8 million and a release of $5.7 million of gross unrecognized tax benefits primarily related to the expiration of statute of limitations in various tax jurisdictions.

The CARES Act has not had, nor is it expected to have, a significant impact on our effective tax rate for 2021.