The Company is subject to income taxes in the United States and numerous foreign jurisdictions. Significant judgment is required in determining the worldwide provision for income taxes and recording the related deferred tax assets and liabilities.

	2018		2017		2016
	(In thousands)
Domestic	$	31,584	$	52,745	$	47,407
Foreign		4,268		2,088		2,437
Total	$	35,852	$	54,833	$	49,844

	2018			2017			2016
	(In thousands)
Current:
Federal	$	9,223		$	20,553		$	14,435
State		2,640			2,933			1,275
Foreign		1,468			876			1,129
Deferred:
Federal		(2,890	)		(3,051	)		922
State		(1,765	)		(915	)		151
Foreign		(614	)		(134	)		(363	)
Total	$	8,062		$	20,262		$	17,549

The provision for income tax differs from the amount that would be provided by applying the statutory U.S. corporate income tax rate in each year due to the following items:

	2018			2017			2016
	(In thousands)
Provision at statutory rate	$	7,529		$	19,192		$	17,445
State income taxes, net of federal tax benefit		717			1,292			923
Valuation allowance		—			564			—
Foreign - tax rate differential and other		159			29			(87	)
Domestic production activities deduction		—			(721	)		(560	)
Federal and state credits		(742	)		(542	)		—
Compensation subject to section 162(m)		562			—			—
Stock based compensation		(384	)		—			—
Tax rate difference on temporary adjustments		(460	)		—			—
Other		681			448			(172	)
Actual provision	$	8,062		$	20,262		$	17,549

	2018			2017
	(In thousands)
Deferred tax assets:
Reserve for receivables and inventories	$	2,210		$	2,405
Accrued compensation		929			861
Payables		1,090			886
Non-pension postretirement benefits		1,110			1,561
Net operating loss and credit carryforwards		308			364
Accrued pension benefits and deferred compensation		1,552			1,071
Accrued employee benefits		2,534			3,219
Deferred revenue		1,858			1,504
Other		—			450
Total gross deferred tax assets		11,591			12,321
Less: valuation allowance		(366	)		(373	)
Total net deferred tax assets		11,225			11,948
Deferred tax liabilities:
Depreciation		4,679			3,778
Amortization		7,146			8,266
Prepaids		517			482
Other		52			—
Total deferred tax liabilities		12,394			12,526
Net deferred tax liabilities	$	(1,169	)	$	(578	)

The Company’s U.S. federal and state net operating loss and U.S. federal general business credit carryforwards are limited on an annual basis to $1.2 million under Internal Revenue Code Section 382 and Section 383. The federal net operating loss carryforwards must be fully utilized prior to the utilization of the federal credit carryforwards.

At December 31, 2017, the Company had an immaterial amount of U.S. federal net operating losses and general business credits, all of which were utilized in 2018. The Company’s remaining tax credit carryforward of $0.3 million relates to state specific tax credits that the Company expects to fully utilize in future tax periods.

No provision for federal income taxes was made on the earnings of foreign subsidiaries that are considered indefinitely invested or that would be offset by foreign tax credits upon distribution. Such undistributed earnings at December 31, 2018 were $23.6 million of which $21.7 million was previously taxed in the U.S. under the transition tax provisions (discussed below) and other provisions of the Internal Revenue Code.

Changes in the Company's gross liability for unrecognized tax benefits, excluding interest and penalties, were as follows:

	2018			2017
	(In thousands)
Balance at beginning of year	$	998		$	814
Increases in unrecognized tax benefits as a result of positions taken during the prior period		127			6
Increases in unrecognized tax benefits as a result of positions taken during the current period		190			230
Reductions to unrecognized tax benefits as a result of a lapse of the applicable statute of limitations		(194	)		(52	)
Balance at end of year	$	1,121		$	998

The Company does not expect a significant increase or decrease to the total amounts of unrecognized tax benefits during the fiscal year ending December 31, 2019. To the extent these unrecognized tax benefits are ultimately recognized, they will impact the effective tax rate.

The Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction, and various states and foreign jurisdictions. The Company is no longer subject to U.S. federal income tax examinations by tax authorities for years prior to 2015 and, with few exceptions, state and local income tax examinations by tax authorities for years prior to 2014. The Company's policy is to recognize interest related to unrecognized tax benefits as interest expense and penalties as operating expenses. Accrued interest was less than $0.1 million at December 31, 2018 and 2017, respectively, and there were no penalties accrued in either year.

On December 22, 2017, the President signed H.R.1, “An Act to Provide for Reconciliation Pursuant to Titles II and V of the Concurrent Resolution on the Budget for Fiscal Year 2018” (the “Tax Act”) (previously known as “The Tax Cuts and Jobs Act”). The Tax Act made broad and complex changes to the U.S. tax code that affected 2017, including, but not limited to (i) reducing the future U.S. federal corporate tax rate from 35% to 21%; (ii) requiring companies to pay a one-time transition tax on certain unrepatriated earnings of foreign subsidiaries; and (iii) bonus depreciation that will allow for full expensing of qualified property.

The Tax Act also established new tax laws that affected 2018 and will affect future years, including, but not limited to (i) reduction of the U.S. federal corporate tax rate; (ii) a general elimination of U.S. federal income taxes on dividends from foreign subsidiaries; (iii) a new provision designed to tax global intangible low-taxed income (“GILTI”); (iv) the repeal of the domestic production activity deductions; (v) limitations on the deductibility of certain executive compensation; (vi) limitations on the use of foreign tax credits to reduce the U.S. income tax liability; and (vii) a new provision that allows a domestic corporation an immediate deduction for a portion of its foreign derived intangible income (“FDII”). The Company considered the relevant provisions of the Tax Act in recording its 2018 provision.

The Securities and Exchange Commission staff issued Staff Accounting Bulletin (“SAB”) 118 in December 2017, which provided guidance on accounting for the tax effects of the Tax Act. SAB 118 provided a measurement period of up to one year from the Tax Act enactment date for companies to complete the accounting under ASC 740, Accounting for Income Taxes. In accordance with SAB 118, a company must reflect the income tax effects of those aspects of the Tax Act for which the accounting under ASU 2016-16 is complete. To the extent that a company’s accounting for a certain income tax effect of the Tax Act is incomplete, but it is able to determine a reasonable estimate, it must record a provisional estimate in the financial statements. If a company cannot determine a provisional estimate to be included in the financial statements, it should continue to apply ASU 2016-16 on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the Tax Act.

As of December 31, 2017, the Company’s accounting for the certain elements of the Tax Act was incomplete. However, the Company was able to make reasonable estimates of the effect, and therefore recorded provisional estimates for those items. In connection with the initial analysis of the impact of the Tax Act, the Company recorded an immaterial discrete adjustment in the period ended December 31, 2017. This provisional estimate consisted of a net tax expense of $0.8 million for the one-time transition tax and a net tax benefit of $0.8 million related to revaluation of deferred tax assets and liabilities, caused by the new lower corporate tax rate. To determine the transition tax, the Company determined the amount of post-1986 accumulated earnings and profits of the relevant subsidiaries, as well as the amount of non-U.S. income taxes paid on such earnings. While the Company was able to make a reasonable estimate of the transition tax, the Company continued to gather additional information to more precisely compute the final amount reported in the 2017 U.S. federal income tax return filed in October 2018. This resulted in an immaterial adjustment to the provisional amount. During 2018, the Company recorded a net tax benefit of $1.2 million primarily attributable to pension contributions made in 2018 that were deductible on the 2017 tax return at the higher 35% federal tax rate and other changes to the 2017 tax provision related to the Tax Act and subsequently-issued tax guidance. During 2018, the Company recorded a favorable provision-to-return adjustment of $0.5 million primarily related to the difference in income tax rates between 2017 and 2018.

Due to the complexity of the new GILTI tax rules, the Company continued to evaluate this provision of the Tax Act and the application of ASC 740 “Income Taxes” throughout 2018. Under GAAP, the Company is allowed to make an accounting policy choice to either: (i) treat taxes due on future U.S. inclusions in taxable income related to GILTI as a current-period expense when incurred (the “period cost method”); or (ii) factor in such amounts into a company’s measurement of its deferred taxes (the “deferred method”). The Company selected to apply the “period cost method” to account for the new GILTI tax, and treated it as a current period expense for 2018. The Company will continue to analyze the full effects of the Tax Act on its financial statements in 2019 as additional guidance is issued and interpretations evolve.