Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Income Tax Disclosure [Abstract]

Components of Consolidated Income Tax Provision

The following is an analysis of the components of the consolidated income tax provision (dollars in millions):

	Year Ended December 31,
	2018		2017			2016
Current income tax provision (benefit) -
U.S. federal	$	150.7	$	209.3		$	213.6
State and local		42.9		34.9			29.1
Foreign		0.2		0.3			0.2
Total current provision for taxes		193.8		244.5			242.9
Deferred -
U.S. federal		34.7		(90.2	)		(1.2	)
State and local		4.0		5.7			(3.0	)
Foreign		—		—			0.2
Total deferred provision (benefit) for taxes		38.7		(84.5	)		(4.0	)
Total provision for taxes	$	232.5	$	160.0		$	238.9

Summary of Effective Tax Rate

The effective tax rate varies from the U.S. federal statutory tax rate principally due to the following (dollars in millions):

	2018			2017			2016
Provision computed at U.S. federal statutory rate (a)	$	203.8		$	290.0		$	241.0
Federal tax reform		(2.0	)		(127.2	)		—
State and local taxes, net of federal benefit		36.9			24.0			19.8
Domestic manufacturers deduction (b)		—			(21.1	)		(21.1	)
Other		(6.2	)		(5.7	)		(0.8	)
Total	$	232.5		$	160.0		$	238.9

(a) U.S. federal statutory rate of 21% in 2018 and 35% in 2017 and 2016.

(b) The domestic manufacturers deduction was eliminated after 2017 as a result of the Tax Cuts and Jobs Act.

Details of Scheduled Expiration Dates of Tax Effected Net Operating Loss (NOL) and Other Tax Carryforwards

The following details the scheduled expiration dates of our tax effected net operating loss (NOL) and other tax carryforwards at December 31, 2018 (dollars in millions):

	2019 Through 2028		2029 Through 2038		Indefinite		Total
U.S. federal NOLs	$	28.6	$	3.8	$	—	$	32.4
State taxing jurisdiction NOLs		1.8		0.2		—		2.0
U.S. federal tax credit carryforwards		—		0.1		—		0.1
U.S. federal and non-U.S. capital loss    carryforwards		3.1		—		0.1		3.2
Total	$	33.5	$	4.1	$	0.1	$	37.7

Deferred Income Tax Assets and Liabilities

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts for income tax purposes. Deferred income tax assets and liabilities at December 31 are summarized as follows (dollars in millions): 

	December 31,
	2018			2017
Deferred tax assets:
Accrued liabilities	$	17.1		$	13.7
Employee benefits and compensation		37.7			21.1
Inventories		12.6			15.4
Net operating loss carryforwards		34.4			38.1
Restricted stock and performance units		10.2			9.0
Pension and postretirement benefits		87.4			90.6
Derivatives		4.7			6.1
Capital loss and general business credit carryforwards		3.3			3.2
Gross deferred tax assets		207.4			197.2
Valuation allowance (c)		(3.1	)		(3.1	)
Net deferred tax assets	$	204.3		$	194.1
Deferred tax liabilities:
Property, plant and equipment	$	(422.3	)	$	(368.6	)
Goodwill and intangible assets		(67.2	)		(65.0	)
Total deferred tax liabilities	$	(489.5	)	$	(433.6	)
Net deferred tax liabilities (d)	$	(285.2	)	$	(239.5	)

(c) Deferred tax assets are reduced by a valuation allowance when it is more likely than not that some portion of the deferred tax assets will not be realized. Both the 2018 and 2017 valuation allowance relates to capital losses. We do not expect to generate capital gains before the capital losses expire. If or when recognized, the tax benefits relating to the reversal of any or all of the valuation allowance would be recognized as a benefit to income tax expense.

(d) As of December 31, 2018, we did not recognize U.S. deferred income taxes on our cumulative total of undistributed foreign earnings for our foreign subsidiaries. We indefinitely reinvest our earnings in operations outside the United States. It is not practicable to determine the amount of unrecognized deferred tax liability on these undistributed earnings because the actual tax liability, if any, is dependent on circumstances existing when the repatriation occurs.

Summary of Changes Related to PCA’s Gross Unrecognized Tax Benefits Excluding Interest and Penalties

The following table summarizes the changes related to PCA’s gross unrecognized tax benefits excluding interest and penalties (dollars in millions):

	2018			2017				2016
Balance as of January 1	$	(4.8	)	$	(5.2	)	$	(5.8	)
Increases related to prior years’ tax positions		(0.1	)		—			—
Increases related to current year tax positions		(0.3	)		(0.4	)		(0.5	)
Decreases related to prior years' tax positions		—			—			0.1
Settlements with taxing authorities		—			—			0.3
Expiration of the statute of limitations		0.6			0.8			0.7
Balance at December 31	$	(4.6	)	$	(4.8	)	$	(5.2	)