Note 11 - Income Taxes

3 Months Ended

Mar. 31, 2022

Notes to Financial Statements

Income Tax Disclosure [Text Block]

11. INCOME TAXES

The Company's estimated taxable income in future periods is not on a legal entity basis and therefore income tax expense for the interim period is not measured using the annual effective tax rate ("AETR") method.  The Company is working on developing reliable estimates for future periods.  The Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction and various states and foreign jurisdictions.  The Company is no longer subject to U.S. federal examinations by tax authorities for years before 2018 and for state examinations before 2015.  Regarding foreign subsidiaries, the Company is no longer subject to examination by tax authorities for years before 2011 in Asia and generally 2013 in Europe. 

As a result of the expiration of the statutes of limitations for specific jurisdictions, it is reasonably possible that the related unrecognized benefits for tax positions taken regarding previously filed tax returns may change materially from those recorded as liabilities for uncertain tax positions in the Company’s consolidated financial statements at March 31, 2022.  The Company’s liabilities for uncertain tax positions totaled $28.7 million and $28.4 million at March 31, 2022 and December 31, 2021, respectively, of which $4.1 million are expected to be resolved during 2022 by way of expiration of the related statute of limitations.  These amounts, if recognized, would reduce the Company’s effective tax rate.

The Company’s policy is to recognize interest and penalties related to uncertain tax positions as a component of the current provision for income taxes. During the three months ended March 31, 2022 and 2021, the Company recognized $0.2 million in interest and penalties in the condensed consolidated statements of operations during each period.  The Company has approximately $5.2 million and $5.0 million, respectively, accrued for the payment of interest and penalties at March 31, 2022 and December 31, 2021, which is included in liability for uncertain tax positions in the condensed consolidated balance sheets.