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Income Taxes
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Income tax provision (benefit) for the years ended December 31, consists of the following (in thousands): 
202220212020
Current:
Federal$139,423 $134,111 $4,877 
State20,367 14,508 2,614 
Foreign48,165 28,266 19,560 
207,955 176,885 27,051 
Deferred:
Federal(12,313)(2,169)(30,779)
State(7,761)(3,795)(11,579)
Foreign4,138 (1,708)(1,721)
(15,936)(7,672)(44,079)
$192,019 $169,213 $(17,028)
The components of Income (loss) before income taxes for the years ended December 31, were as follows (in thousands): 
202220212020
Domestic$750,793 $698,578 $(81,522)
Foreign180,440 120,659 65,792 
$931,233 $819,237 $(15,730)
Income tax provision (benefit) differs from the amount that would be provided by applying the statutory U.S. corporate income tax rate for the years ended December 31, due to the following items (in thousands): 
202220212020
Provision (benefit) at statutory rate$195,553 $172,040 $(3,303)
State taxes, net of federal benefit19,223 16,568 822 
Foreign rate differential3,620 4,303 60 
Foreign derived intangible income(8,187)— — 
Research and development credit(18,809)(8,046)(8,442)
Unrecognized tax benefits including interest and penalties(11,793)(6,554)(8,567)
Valuation allowance adjustments6,714 (1,928)9,675 
State credits(6,954)(5,403)(13,106)
Global intangible low-taxed income1,607 1,143 1,480 
Adjustments for previously accrued taxes(6,318)(8,500)(4,951)
Executive compensation limitation 4,893 3,104 2,543 
Other foreign inclusions16,562 34 4,415 
Other(4,092)2,452 2,346 
Income tax provision (benefit) $192,019 $169,213 $(17,028)
The 2017 Tax Cuts and Jobs Act subjects U.S. shareholders to current tax on global intangible low-taxed income (GILTI) earned by certain foreign subsidiaries for which a company can elect to either recognize deferred taxes or to provide tax expense in the year incurred. The Company has elected to account for GILTI in the year the tax is incurred.
The Company qualifies for certain tax holidays in Thailand if certain employment and manufacturing criteria are met. The impact of the tax holiday decreased foreign taxes by $7.2 million in 2022. The benefit of the tax holiday on net income per share (diluted) was $0.04.
The principal components of the Company’s deferred income tax assets and liabilities as of December 31, include the following (in thousands):
20222021
Deferred income tax assets:
Accruals not yet tax deductible$133,349 $133,150 
Stock compensation11,616 10,908 
Net operating loss and research & development tax credit carryforwards63,517 60,401 
Amortization of research and experimental costs43,034 — 
Other55,800 66,245 
307,316 270,704 
Valuation allowance(40,878)(33,596)
266,438 237,108 
Deferred income tax liabilities:
Depreciation, tax in excess of book(49,889)(66,301)
Pension and postretirement healthcare plan obligations(58,843)(67,741)
Withholding tax(23,632)(7,927)
Other(28,561)(21,478)
(160,925)(163,447)
$105,513 $73,661 
The Company reviews its deferred income tax asset valuation allowances on a quarterly basis, or whenever events or changes in circumstances indicate that a review is required. In determining the requirement for a valuation allowance, the historical and projected financial results of the legal entity or consolidated group recording the net deferred income tax asset is considered, along with any positive or negative evidence including tax law changes. Since future financial results and tax law may differ from previous estimates, periodic adjustments to the Company’s valuation allowances may be necessary.
The Company's gross state net operating loss carryforwards were as follows at December 31, (in thousands):
Year of Expiration20222021
2031$219,726 $236,624 
203224 — 
203346 46 
2034109 112 
2035553 7,882 
203660 — 
2037195 433 
2038820 5,601 
20399,375 13,581 
204031,879 34,613 
20412,135 3,486 
2042458 — 
Indefinite2,923 8,441 
$268,303 $310,819 
The Company also had Wisconsin research and development credit carryforwards of $47.8 million at December 31, 2022, expiring in 2024-2037.
At December 31, 2022, the Company had a deferred tax asset of $53.4 million related to its state net operating loss and Wisconsin research and development credit carryforwards and a deferred tax asset of $10.1 million related to foreign net operating losses.
The Company's valuation allowance was $40.9 million at December 31, 2022 and included $25.3 million related to state net operating loss and Wisconsin research and development credit carryforwards, $7.6 million related to foreign net operating loss carryforwards and $8.0 million related to other deferred tax assets. The change in the valuation allowance from prior year included an increase of $7.1 million related to state net operating loss and Wisconsin research and development credit carryforwards and a decrease of $0.3 million related to foreign operations.
The Company recognizes interest and penalties related to unrecognized tax benefits in Income tax provision (benefit). Changes in the Company’s gross liability for unrecognized tax benefits, excluding interest and penalties, were as follows (in thousands): 
20222021
Unrecognized tax benefits, beginning of period$44,856 $50,597 
Increase in unrecognized tax benefits for tax positions taken in a prior period373 35 
Decrease in unrecognized tax benefits for tax positions taken in a prior period(8,885)(6,402)
Increase in unrecognized tax benefits for tax positions taken in the current period3,158 3,188 
Statute lapses(2,753)(2,340)
Settlements with taxing authorities(4,720)(222)
Unrecognized tax benefits, end of period$32,029 $44,856 
The amount of unrecognized tax benefits as of December 31, 2022 and 2021 that, if recognized, would affect the effective tax rate was $27.1 million and $38.4 million, respectively.
The total gross amount of benefit related to interest and penalties associated with unrecognized tax benefits recognized during 2022, 2021 and 2020 in the Consolidated statements of operations was $5.6 million, $2.6 million and $2.1 million, respectively.
The total gross amount of interest and penalties associated with unrecognized tax benefits recognized at December 31, 2022 and 2021 in the Consolidated balance sheets was $17.4 million and $22.9 million, respectively.
The Company does not expect a significant increase or decrease to the total amounts of unrecognized tax benefits related to continuing operations during the fiscal year ending December 31, 2023. However, the Company is under regular audit by tax authorities. The Company believes that it has appropriate support for the positions taken on its tax returns and that its annual tax provision includes amounts sufficient to pay any assessments. Nonetheless, the amounts ultimately paid, if any, upon resolution of the issues raised by the taxing authorities may differ materially from the amounts accrued for each year.
The Company or one of its subsidiaries files income tax returns in the U.S. federal and Wisconsin state jurisdictions and various other state and foreign jurisdictions. The Company is no longer subject to income tax examinations for Wisconsin state income taxes before 2018 or for U.S. federal income taxes before 2019.