Income Taxes

6 Months Ended

Jun. 30, 2023

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

For the three and six months ended June 30, 2023, income tax expense was $22.2 million and $59.1 million, respectively, representing an effective tax rate of 26% and 25%, respectively. The items resulting in variances from the federal statutory rate of 21% for the three and six months ended June 30, 2023 primarily consist of state and local income tax expense and tax expense related to non-deductible compensation.

For the three and six months ended June 30, 2022, income tax expense was $33.0 million and $74.7 million, respectively, representing an effective tax rate of 27% for both periods. The items resulting in variances from the federal statutory rate of 21% for the three and six months ended June 30, 2022 primarily consist of state and local income tax expense and tax expense for an increase in the valuation allowance for foreign taxes.

At June 30, 2023, the Company had foreign tax credit carry forwards of approximately $52.5 million, expiring on various dates from 2024 through 2033. These carryforwards have been reduced by a valuation allowance of $52.5 million as it is more likely than not that these carry forwards will not be realized. For the six months ended June 30, 2023, $0.4 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).

As of June 30, 2023, approximately $198.0 million of cash and cash equivalents, previously held by foreign subsidiaries, was repatriated to the United States. Our consolidated cash and cash equivalents balance of $893.4 million, as of June 30, 2023, includes approximately $178.7 million held by foreign subsidiaries. Of this amount, approximately $60.0 million is expected to be repatriated to the United States with the remaining amount continuing to be reinvested in foreign operations. Tax expense related to the repatriated amount, as well as the expected remaining repatriation amount, has been accrued in the current period and the Company does not expect to incur any significant, additional taxes related to the remaining balance.