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Income Taxes
9 Months Ended
Sep. 30, 2018
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes

The provision for income taxes as a percentage of earnings before income taxes for the third quarter of 2018 was 21.9% compared to 34.5% in the third quarter of 2017. The provision for income taxes as a percentage of earnings before income taxes for the first three quarters of 2018 was 22.2% compared to 34.8% for the first three quarters of 2017. Interim provisions are tied to an estimate of the overall annual rate which can vary due to state taxes and the relationship of foreign and domestic earnings. These items cause variations between periods. The decrease between years was due almost entirely to the lower Federal tax rate which was a result of U.S. tax reform that was enacted in December 2017. For the nine months ended September 30, 2018 and 2017, the Company recognized discrete net tax benefits related to pension plan contributions and termination costs (2018 only) as well as the excess tax benefits from stock-based compensation of $6.0 million and $0.2 million, respectively.
    
In December 2017, the Tax Cuts and Jobs Act of 2017 (the “Act”) was signed into law making significant changes to the Internal Revenue Code. Changes include, but are not limited to, a corporate tax rate decrease from 35% to 21% effective for tax years beginning after December 31, 2017, the transition of U.S. international taxation from a worldwide tax system to a territorial system, and a one-time transition tax on the mandatory deemed repatriation of cumulative foreign earnings as of December 31, 2017.

On December 22, 2017, Staff Accounting Bulletin No. 118 (“SAB 118”) was issued to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Act. For the three- and nine-month periods ended September 30, 2018, the Company updated its transition tax calculation in preparation for the filing of its 2017 Federal income tax return in October 2018. The change in the transition tax was immaterial compared to the provisional amount of transition tax recorded as of December 31, 2017.

The Company is subject to numerous other provisions of the Act that are effective for tax years starting after December 31, 2017.  These provisions include the Global Intangible Low-Taxed Income inclusion, the deduction for Foreign-Derived Intangible Income, the business interest expense deduction limitation under Section 163(j), the executive compensation provision under Section 162(m), and the reduced deduction for certain meals and entertainment related expenses. The Company will continue to refine its computation related to these provisions as additional guidance becomes available. The net impact of these provisions is not expected to have a material impact on the Company’s consolidated financial statements.