Income Taxes

9 Months Ended

Sep. 30, 2020

Income Tax Disclosure [Abstract]

Income Taxes

NOTE 17 — Income Taxes

The effective tax rates for the three and nine months ended September 30, 2020 and 2019 are as follows:

	Three months ended						Nine months ended
	September 30,			September 30,			September 30,			September 30,
	2020			2019			2020			2019
Effective tax rate		22.2	%		62.2	%		24.4	%		30.3	%

Our effective income tax rate was 22.2% and 62.2% in the third quarters of 2020 and 2019, respectively. This decrease is primarily attributed to the change in the mix of earnings by jurisdiction and the 2019 increase to reserves for uncertain tax position associated with the company’s operations in China. The third quarter 2020 tax rate was higher than the U.S. statutory federal tax rate primarily due to foreign withholding taxes, state taxes and foreign earnings that are taxed at higher rates.

Our effective income tax rate was 24.4%% and 30.3% in the first nine months of 2020 and 2019, respectively. This decrease is primarily attributed to the change in the mix of earnings by jurisdiction, decreases in uncertain tax position offset by the establishment of valuation allowance on certain U.S. tax credits and the Company’s decision to no longer permanently reinvest the earnings of its Taiwan subsidiary. The tax rate in the first nine months of 2020 was higher than the U.S statutory federal tax rate primarily due to the establishment of valuation allowances on certain U.S. tax credits and the Company’s decision to no longer permanently reinvest the earnings of its Taiwan subsidiary. The tax rate in the first nine months of 2019 was higher than the U.S. statutory federal tax rate primarily due to an increase to reserves for uncertain tax positions associated with the Company’s operations in China and foreign earnings that are taxed at higher rates.