Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Income (loss) before income taxes consists of the following:

Significant components of income tax expense (benefit) are as follows:



	Year Ended December 31,
	2018			2017			2016
Current:
Federal	$	1.5		$	8.7		$	9.7
State and local	0.5			0.2			0.6
Foreign	6.4			5.9			(14.7		)
Total current	8.4			14.8			(4.4		)
Deferred:
Federal	3.8			(30.7		)	14.0
State and local	1.5			(0.2		)	(0.1		)
Foreign	(0.3		)	(0.5		)	1.1
Total deferred	5.0			(31.4		)	15.0
Total income tax expense (benefit)	$	13.4		$	(16.6	)	$	10.6

The reconciliation of income taxes computed at the U.S. federal statutory tax rate to income tax expense (benefit) is as follows:



	Year Ended December 31,
	2018			2017			2016
Income tax expense at U.S. statutory rate	$	14.1		$	3.6		$	7.9
State income taxes, net of federal tax benefit	1.7			0.2			0.4
Foreign income, net of credit on foreign taxes	0.7			8.5			—
Effective tax rate differential of earnings outside of U.S.	2.6			(0.3		)	0.5
Change in valuation allowance	38.4			7.6			6.8
Research & experimentation credits	(0.9		)	(0.5		)	(0.7		)
Non-deductible items	0.4			0.7			0.7
Change in uncertain tax positions	0.2			0.1			(0.2		)
Share-based compensation	(3.3		)	—			—
Domestic production activities deduction	—			(0.4		)	(1.2		)
Tax effect of insurance proceeds	—			—			(6.0		)
Capital loss carryover	(29.7		)	—			—
Tax effect of 2017 tax reform federal rate change	(11.3		)	(26.7		)	—
Tax effect of carryforward foreign tax credits	(0.6		)	(9.4		)	—
Other items	1.1			—			2.4
Income tax expense (benefit)	$	13.4		$	(16.6	)	$	10.6

Significant components of our deferred tax assets and liabilities are as follows:



	December 31,
	2018			2017
Deferred tax assets:
Accruals and reserves	$	15.9		$	11.7
Pensions	3.3			2.0
Inventory	2.2			4.1
Share-based compensation	6.5			6.6
Tax credit carryforwards	16.2			16.4
Foreign net operating loss carryforwards	11.2			11.7
State net operating loss carryforwards	0.6			2.0
Capital loss carryover	29.7			—
Other – net	13.5			0.2
Total deferred tax assets before valuation allowances	99.1			54.7
Valuation allowances	(65.2		)	(26.8		)
Total deferred tax assets, net of valuation allowances	$	33.9		$	27.9
Deferred tax liabilities:
Property, plant and equipment	$	15.4		$	15.0
Goodwill and intangible assets	88.9			71.4
Convertible notes	(0.4		)	(0.5		)
Other – net	1.6			4.1
Total deferred tax liabilities	$	105.5		$	90.0
Net deferred tax liabilities	$	71.6		$	62.1
The net deferred tax liability is classified as follows:
Other assets	$	(4.8	)	$	—
Long-term deferred tax liabilities	76.4			62.1
Net deferred tax liabilities	$	71.6		$	62.1

The reconciliation of beginning to ending unrecognized tax benefits is as follows:



	Year Ended December 31,
	2018			2017			2016
Unrecognized tax benefits at beginning of the year	$	0.8		$	0.8		$	1.0
Additions for tax positions of prior years	0.9			0.1			—
Additions for tax positions acquired	1.4			—			—
Reductions for tax positions of prior years	(0.8		)	(0.1		)	—
Lapse of statutes of limitation	—			—			(0.2		)
Unrecognized tax benefits at end of the year	$	2.3		$	0.8		$	0.8