INCOME TAXES

9 Months Ended

Sep. 30, 2022

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

The tax provision for interim periods is determined using the estimated annual effective consolidated tax rate, based on the current estimate of full-year earnings and related estimated full year-taxes, adjusted for the impact of discrete quarterly items.

The effective tax rate for the three months ended September 30, 2022 and 2021, respectively, was 36.2% and 29.2%. The effective tax rate for the nine months ended September 30, 2022 and 2021, respectively, was 31.0% and 22.9%. The tax rate for the three months ended September 30, 2022 reflects an out-of-period charge of $7.2 million for taxes related to a legal entity reorganization to enhance the Company's dividend and cash management capabilities. The tax charge contributed 8.5% to the impact on the effective tax rate for the three months ended September 30, 2022. The tax charge should have been recognized in the three months ended March 31, 2022. The lower reported effective tax rate for the nine months ended September 30, 2021 reflects additional tax benefits from employee stock-based compensation. The impacts of the error on the three months ended March 31, 2022 and the three months ended September 30, 2022 are not considered material to either period.