Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

Income from continuing operations before income taxes and income taxes are as follows:



(In Thousands)	2014			2013			2012
Income from continuing operations before income taxes:
Domestic	$	38,402		$	37,380		$	35,488
Foreign	7,014			15,552			26,016
Total	$	45,416		$	52,932		$	61,504
Current income taxes:
Federal	$	14,568		$	15,988		$	10,905
State	2,178			1,416			796
Foreign	4,102			4,737			7,372
Total	20,848			22,141			19,073
Deferred income taxes:
Federal	(9,530		)	(2,933		)	1,212
State	(417		)	(852		)	163
Foreign	(1,514		)	(1,361		)	(2,129		)
Total	(11,461		)	(5,146		)	(754		)
Total income taxes	$	9,387		$	16,995		$	18,319

The significant differences between the U.S. federal statutory rate and the effective income tax rate for continuing operations are as follows:



	Percent of Income Before Income Taxes from Continuing Operations
	2014		2013		2012
Income tax expense at federal statutory rate	35.0		35.0		35.0
State taxes, net of federal income tax benefit	2.2		0.1		1.1
Tax contingency accruals and tax settlements	2.0		2.0		(0.5	)
Non-deductible expenses	0.9		0.6		0.3
Foreign rate differences	(0.1	)	(0.7	)	(0.6	)
Tax incentive	(0.1	)	(4.7	)	(7.0	)
Valuation allowance for foreign operating loss carry-forwards	(0.4	)	0.5		(0.1	)
Research and development tax credit	(0.6	)	(0.4	)	—
Domestic Production Activities Deduction	(1.9	)	(1.4	)	(0.6	)
Changes in estimates related to prior year tax provision	(2.3	)	(0.6	)	(0.5	)
Unremitted earnings from foreign operations	(3.8	)	0.9		0.6
Valuation allowance for capital loss carry-forwards	(10.2	)	0.8		1.9
Other	—		—		0.2
Effective income tax rate for continuing operations	20.7		32.1		29.8

Deferred tax liabilities and deferred tax assets at December 31, 2014 and 2013, are as follows:



(In Thousands)	2014		2013
Deferred tax liabilities:
Amortization of goodwill and other intangibles	$	45,696	$	46,738
Depreciation	27,550		29,994
Foreign currency translation gain adjustment	4,233		8,620
Derivative financial instruments	316		432
Total deferred tax liabilities	77,795		85,784
Deferred tax assets:
Pensions	34,214		14,813
Employee benefits	11,597		11,124
Inventory	6,221		2,292
Excess capital losses and book/tax basis differences on investments	3,282		4,316
Tax benefit on state and foreign NOL and credit carryforwards	2,967		1,871
Asset write-offs, divestitures and environmental accruals	1,593		3,734
Timing adjustment for unrecognized tax benefits on uncertain tax positions, including portion relating to interest and penalties	842		600
Allowance for doubtful accounts	479		639
Other	799		1,247
Deferred tax assets before valuation allowance	61,994		40,636
Less: Valuation allowance	14,577		20,019
Total deferred tax assets	47,417		20,617
Net deferred tax liability	$	30,378	$	65,167
Included in the balance sheet:
Noncurrent deferred tax liabilities in excess of assets	$	39,255	$	70,795
Current deferred tax assets in excess of liabilities	8,877		5,628
Net deferred tax liability	$	30,378	$	65,167

A reconciliation of the Company’s unrecognized uncertain tax positions since January 1, 2012, is shown below:



	Years Ended December 31,
(In Thousands)	2014		2013		2012
Balance at beginning of period	$	2,239	$	910	$	1,025
Increase (decrease) due to tax positions taken in:
Current period	619		643		432
Prior period	397		686		(21		)
Increase (decrease) due to settlements with taxing authorities	—		—		(398		)
Reductions due to lapse of statute of limitations	—		—		(128		)
Balance at end of period	$	3,255	$	2,239	$	910

Additional information related to unrecognized uncertain tax positions since January 1, 2012 is summarized below:



	Years Ended December 31,
(In Thousands)	2014			2013			2012
Gross unrecognized tax benefits on uncertain tax positions (reflected in current income tax and other noncurrent liability accounts in the balance sheet)	$	3,255		$	2,239		$	910
Deferred income tax assets related to unrecognized tax benefits on uncertain tax positions (reflected in deferred income tax accounts in the balance sheet)	(726		)	(540		)	(212		)
Net unrecognized tax benefits on uncertain tax positions, which would impact the effective tax rate if recognized	2,529			1,699			698
Interest and penalties accrued on deductions taken relating to uncertain tax positions (approximately $150, $100 and $(300) reflected in income tax expense in the income statement in 2014, 2013 and 2012, respectively, with the balance shown in current income tax and other noncurrent liability accounts in the balance sheet)	310			156			60
Related deferred income tax assets recognized on interest and penalties	(116		)	(60		)	(23		)
Interest and penalties accrued on uncertain tax positions net of related deferred income tax benefits, which would impact the effective tax rate if recognized	194			96			37
Total net unrecognized tax benefits on uncertain tax positions reflected in the balance sheet, which would impact the effective tax rate if recognized	$	2,723		$	1,795		$	735