Note 13—Income taxes:

	Three months ended September 30,						Nine months ended September 30,
	2013			2014				2013			2014
	(In millions)
Expected tax expense (benefit), at U.S. federal statutory income tax rate of 35%	$	(21.0	)	$	18.6		$	(72.0	)	$	30.4
Incremental tax (benefit) on earnings of non-U.S. and non-tax group companies		1.3			(1.4	)		(3.4	)		(2.6	)
Non-U.S. tax rates		.8			(1.3	)		3.3			(3.0	)
Adjustment to the reserve for uncertain tax positions, net		.6			.5			2.3			(5.1	)
Nondeductible expenses		.5			.9			3.1			2.1
Adjustment to prior year taxes		-			(2.0	)		-			(1.8	)
U.S. state income taxes and other, net		(1.1	)		.5			(1.3	)		1.1
Income tax expense (benefit)	$	(18.9	)	$	15.8		$	(68.0	)	$	21.1

	Three months ended September 30,						Nine months ended September 30,
	2013			2014				2013			2014
	(In millions)
Comprehensive provision for income taxes (benefit) allocable to:
Net income (loss)	$	(18.9	)	$	15.8		$	(68.0	)	$	21.1
Other comprehensive income (loss):
Marketable securities		6.3			.1			7.5			(11.1	)
Currency translation		4.1			(8.9	)		2.8			(10.5	)
Pension plans		1.2			1.0			3.6			2.9
OPEB plans		(.2	)		(.2	)		(.5	)		(.6	)
Total	$	(7.5	)	$	7.8		$	(54.6	)	$	1.8

Tax authorities are examining certain of our U.S. and non-U.S. tax returns and have or may propose tax deficiencies, including penalties and interest. Because of the inherent uncertainties involved in settlement initiatives and court and tax proceedings, we cannot guarantee that these matters will be resolved in our favor, and therefore our potential exposure, if any, is also uncertain. We believe we have adequate accruals for additional taxes and related interest expense which could ultimately result from tax examinations. We believe the ultimate disposition of tax examinations should not have a material adverse effect on our consolidated financial position, results of operations or liquidity. We currently estimate that our unrecognized tax benefits may change by $5.6 million during the next twelve months related to the expiration of certain statutes of limitations.

In 2011 and 2012, Kronos received notices of re-assessment from the Canadian federal and provincial tax authorities related to the years 2002 through 2004. We objected to the re-assessments and believed the position was without merit. Accordingly, we appealed the re-assessments and in connection with such appeal we were required to post letters of credit aggregating Cdn. $7.9 million (see Note 10). In the second quarter of 2014, the Appeals Division of the Canadian Revenue Authority ruled in our favor and reversed in their entirety such notices of re-assessment. As a result, we recognized a non-cash income tax benefit of $3.0 million related to the release of a portion of our reserve for uncertain tax positions in the second quarter of 2014 related to the completion of this Canadian income tax audit. In addition, related letters of credit aggregating Cdn. $7.6 million have been cancelled (see Note 10), and we anticipate the remaining Cdn. $.3 million will be cancelled by year end. Also during the second quarter of 2014, we recognized a non-cash income tax benefit of $3.1 million related to the release of a portion of our reserve for uncertain tax positions in conjunction with the completion of an audit of our U.S. income tax return for 2009.

Our provision for income taxes in the first quarter of 2014 includes a $1.0 million provision which is a correction of amounts that should have been recognized in the fourth quarter of 2012, and is not material to any current or prior periods. Our provision for income taxes in the third quarter of 2014 includes a $2 million cash tax benefit associated with certain U.S. income tax credits, which we elected to claim on our 2012 amended U.S. federal tax return in the third quarter of 2014.