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Income Taxes
6 Months Ended
Jun. 30, 2018
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes
For the three and six months ended June 30, 2018, income tax expense was $32.5 million and $89.4 million, respectively, representing an effective tax rate of 23% and 25%, respectively, as compared to the federal statutory rate of 21%. For the three months ended June 30, 2018, the effective tax rate differs from the federal statutory due primarily to state and local income tax expense of $2.3 million. For the six months ended June 30, 2018, the effective tax rate differs from the federal statutory rate due primarily to tax expense of $16.1 million for an increase in valuation allowances for foreign taxes and U.S. foreign tax credits; state and local income tax expense of $6.2 million; a tax benefit of $8.3 million for the one-time rate change on deferred tax assets and liabilities that resulted from the extension of certain television production cost deductions included in the Bipartisan Budget Act of 2018 (enacted February 9, 2018); and a tax benefit from foreign subsidiary earnings indefinitely reinvested outside the U.S. of $5.8 million.
For the three and six months ended June 30, 2017, income tax expense was $60.2 million and $133.3 million, respectively, representing an effective tax rate of 36% and 35%, respectively, as compared to the federal statutory rate of 35%. For the three months ended June 30, 2017, the effective tax rate differs from the federal statutory rate due primarily to tax expense of $5.2 million resulting from an increase in the valuation allowances for foreign and local taxes; state and local income tax expense of $2.6 million; partially offset by a tax benefit from the domestic production activities deduction of $4.4 million; and a tax benefit from foreign subsidiary earnings indefinitely reinvested outside the U.S. of $2.6 million. For the six months ended June 30, 2017, the items resulting in variances from the federal statutory rate primarily consist of a tax benefit of $10.3 million from the domestic production activities deduction; a tax benefit from foreign subsidiary earnings indefinitely reinvested outside the U.S. of $6.7 million; tax expense of $7.5 million resulting from an increase in the valuation allowances for foreign and local taxes; and state and local income tax expense of $6.0 million.
At June 30, 2018, the Company had foreign tax credit carry forwards of approximately $15.6 million, expiring on various dates from 2024 through 2025. These carryforwards have been reduced by a valuation allowance of $15.6 million as it is more likely than not that these carry forwards will not be realized. For the six months ended June 30, 2018, $0.7 million relating to amortization of tax deductible second component goodwill was realized as a reduction in tax liability (as determined on a 'with-and-without' approach).