Income Taxes

6 Months Ended

Jun. 30, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Income TaxesThe Company’s provision for income taxes is based upon estimated annual tax rates for the year applied to federal, state and foreign income. The provision for income taxes increased to $27.7 million for the three months ended June 30, 2021 compared to $20.8 million during the same period in 2020. The effective tax rate decreased to 21.3% for the three months ended June 30, 2021 compared to 22.7% during the same period in 2020 primarily due to the impact of the finalization of the Global Intangible Low-Tax Income (“GILTI”) regulations enacted post second quarter of 2020 as well as an increase in the Foreign-Derived Intangible Income (“FDII”) deduction due to an increase in US foreign sourced income.

The provision for income taxes increased to $60.6 million for the six months ended June 30, 2021 from $46.3 million during the same period in 2020. The effective tax rate increased to 22.0% for the six months ended June 30, 2021 compared to 21.1% during the same period in 2020 primarily due to a decrease in the excess tax benefits related to share-based compensation offset by the impact of the final GILTI regulations and increase in FDII.

The Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction as well as various state and foreign jurisdictions. Due to the potential for resolution of federal, state and foreign examinations and the expiration of various statutes of limitation, it is reasonably possible that the Company’s gross unrecognized tax benefits balance may change within the next twelve months by a range of zero to $0.1 million.