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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2020

Schedule of Components of Income before Income Taxes

Below is a summary of the components of the Company’s income before income taxes for the years ended December 31 (in thousands).


	2020		2019		2018
U.S.	$	111,880	$	115,543	$	34,159
Non-U.S.	214,253		160,196		146,962
Income before income taxes	$	326,133	$	275,739	$	181,121

Schedule of Components of Income Tax

The components of the expense (benefit) for income taxes on the above income are summarized in the table below (in thousands).


	2020		2019		2018
Current tax expense:
U.S. federal	$	14,480	$	30,208	$	2,817
State and local	16,360		11,630		6,969
Foreign	62,993		53,105		45,042
Total current	93,833		94,943		54,828
Deferred tax (benefit) expense:
U.S. federal	(7,206)		(16,389)		12,462
State and local	(13,121)		(6,897)		1,258
Foreign	(22,673)		(48,186)		(13,795)
Total deferred	(43,000)		(71,472)		(75)
Total current and deferred	50,833		23,471		54,753
Benefit relating to interest rate swaps used to increase equity	8,257		17,666		3,840
Benefit from stock transactions with employees used to increase equity	56		54		58
Benefit relating to defined-benefit pension adjustments used to increase equity	242		1,258		14
Total tax expense	$	59,388	$	42,449	$	58,665

Schedule of Deferred Tax Assets and Liabilities

The components of long-term deferred tax assets (liabilities) are summarized in the table below (in thousands).


	December 31,
	2020		2019
Accrued liabilities	$	81,302	$	67,577
Operating leases	51,450		54,860
Loss and credit carryforwards	23,852		14,372
Assets relating to equity compensation	14,981		16,842
Other assets	16,290		20,364
Gross deferred tax assets	187,875		174,015
Property, equipment and leasehold improvements	(9,852)		(15,137)
Intangible assets	(172,723)		(212,498)
Prepaid expenses	(46,105)		(49,221)
Other liabilities	(13,152)		(5,799)
Gross deferred tax liabilities	(241,832)		(282,655)
Valuation allowance	(15,717)		(1,556)
Net deferred tax liabilities	$	(69,674)	$	(110,196)

Schedule of Effective Income Tax Rate Reconciliation

The items comprising the differences between the U.S. federal statutory income tax rate and the Company’s effective tax rate on income before income taxes for the years ended December 31 are summarized in the table below.


	2020		2019		2018
Statutory tax rate	21.0	%	21.0	%	21.0	%
State income taxes, net of federal benefit	1.7		1.5		—
Effect of non-U.S. operations	(1.8)		2.7		(10.7)
Intercompany sale of intellectual property	(8.7)		(13.8)		—
Change in the reserve for tax contingencies	6.4		4.7		15.7
Law changes	1.8		—		(1.3)
Stock-based compensation expense	(2.8)		(3.9)		(5.3)

Nondeductible meals and entertainment costs	0.3		1.7		2.7
Gains/Losses on divested operations and held-for-sale assets	—		—		12.2
Limitation on executive compensation	1.3		2.4		2.7
Global intangible low-taxed income, net of foreign tax credits	1.4		1.9		0.1
Foreign-derived intangible income	(0.8)		(1.0)		(2.0)

Goodwill	—		—		(3.8)
Other items, net	(1.6)		(1.8)		1.1
Effective tax rate	18.2	%	15.4	%	32.4	%

Schedule of Reconciliation of Beginning and Ending Unrecognized Tax Benefits

The table below is a reconciliation of the beginning and ending amounts of gross unrecognized tax benefits, excluding interest and penalties, for the years ended December 31 (in thousands).


	2020		2019
Beginning balance	$	102,770	$	90,349
Additions based on tax positions related to the current year	20,177		32,072
Additions for tax positions of prior years	14,085		8,564
Reductions for tax positions of prior years	(2,301)		(16,942)
Reductions for expiration of statutes	(8,191)		(7,481)
Settlements	(390)		(3,867)
Change in foreign currency exchange rates	930		75
Ending balance	$	127,080	$	102,770