Income Taxes

9 Months Ended

Sep. 30, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

Laureate's income tax provisions for all periods consist of federal, state and foreign income taxes. The tax provisions for the nine months ended September 30, 2021 and 2020 are based on estimated full-year effective tax rates, adjusted for discrete income tax items related specifically to the interim periods. Laureate has operations in multiple countries at various statutory tax rates and other operations that are loss-making entities for which it is not more likely than not that a tax benefit will be realized on the loss.

For the nine months ended September 30, 2021, the Company recognized income tax (expense) from continuing operations of $(174,163), as compared to income tax benefit from continuing operations of $293,514 in the prior year period. Income tax expense for the nine months ended September 30, 2021 was primarily driven by jurisdictional mix of earnings, changes in income tax reserves and withholding taxes. In addition, during the nine months ended September 30, 2021, the Company recorded discrete tax expense of approximately $35,700 for changes in estimate associated with provision-to-return adjustments for the amended tax returns for 2018 and 2019 and the tax return for 2020, specifically related to the final regulations that were released by the U.S. Treasury Department in July 2020 for the high-tax exception to global intangible low-taxed income. The income tax benefit for the nine months ended September 30, 2020 was primarily driven by the benefit recorded due to the change in tax status of a Netherlands subsidiary, the issuance of GILTI regulations, pretax loss for the period, and jurisdictional mix of earnings.

During the first quarter of 2021, the Company recorded an out-of-period adjustment of approximately $12,400 for income tax expense that should have been recorded during 2016 through 2020. The Company concluded that the adjustment was immaterial to the consolidated financial statements for both the current and prior periods.