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Income Taxes
6 Months Ended
Jun. 30, 2020
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
 
For the three-month period ended June 30, 2020, the Company's effective tax rate was 9.2% compared to an effective tax rate of 54.0% for the three-month period ended June 30, 2019. For the three months ended June 30, 2020, the rate was negatively impacted by valuation allowance activity of $0.5 million and a foreign withholding tax liability of $0.4 million, resulting in a
lower effective tax rate when in a pre-tax loss position. For the three months ended June 30, 2019, the Company had a pre-tax loss primarily resulting from a pension plan settlement of $25.5 million, resulting in a $10.5 million tax benefit. Excluding the tax benefit of the pension plan settlement, the Company's effective tax rate for the three months ended June 30, 2019 was 22.7%. This was negatively impacted by valuation allowance activity of $0.9 million, partially offset by the Company's geographical mix of earnings.

For the six-month period ended June 30, 2020, the Company's effective tax rate was 4.0% compared to an effective tax rate of 69.7% for the six-month period ended June 30, 2019. For the six months ended June 30, 2020, the Company had a pre-tax loss primarily resulting from impairment charges of $61.1 million. The impairment charges significantly impacted the Company's effective tax rate because $48.7 million of the impairment charges related to non-deductible goodwill, resulting in a low effective tax rate for the six months ended June 30, 2020 when in a pre-tax loss position. Additionally, the effective rate was negatively impacted by valuation allowance activity of $0.7 million. For the six-month period ended June 30, 2019, the Company had a pre-tax loss primarily resulting from a pension plan settlement of $25.5 million, resulting in a $10.5 million tax benefit. Excluding the tax benefit of the pension plan settlement, the Company's effective tax rate for the six months ended June 30, 2019 was 22.5%. This was negatively impacted by valuation allowance activity of $1.2 million partially, offset by the Company's geographical mix of earnings.

The Company and its subsidiaries file a consolidated federal income tax return, as well as returns required by various state and foreign jurisdictions. In the normal course of business, the Company is subject to examination by taxing authorities, including such major jurisdictions as the United States, Canada, China, France, Germany, Hong Kong, India, the Netherlands, and the United Kingdom. With few exceptions, the Company is no longer subject to U.S. federal examinations for years before 2016, state and local examinations for years before 2015, and non-U.S. income tax examinations for years before 2013.

The Company’s effective tax rates in future periods could be affected by an increase or decrease in earnings in countries where tax rates differ from the United States federal tax rate, the relative impact of permanent tax adjustments on earnings from domestic operations, changes in net deferred tax asset valuation allowances, including valuation allowances on loss carryforwards in which no tax benefit can be recognized, stock vesting, pension plan terminations, the completion of acquisitions or divestitures, changes in tax rates or tax laws and the completion of ongoing tax planning strategies and audits.

On July 20, 2020, the U.S. Treasury Department and IRS released T.D. 9902 final regulations for publication in the Federal Register related to the global intangible low-taxed income (“GILTI”) high-tax exception. The final regulations largely adopt the framework of the 2019 proposed regulations, with certain key departures. The most significant departures are that an election to apply the GILTI high-tax exception may be made annually instead of once every five years, and that the calculation is made with respect to each “tested unit” of a controlled foreign corporation, rather than on a qualified business unit by qualified business unit basis. The company is evaluating the final regulations and is assessing potential impacts of these changes to the Company’s financial statements.