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Income Taxes
 12 Months Ended
Dec. 31, 2014
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes
 
The provision for income taxes from operations consisted of the following: 

(in thousands)
 
Years Ended December 31,
 
2014
 
2013
 
2012
Current
 

 
 

 
 

Federal
$
25,178

 
$
19,804

 
$
13,163

State
4,391

 
3,243

 
2,732

Foreign
4,041

 
3,926

 
3,920

Deferred


 
 

 
 

Federal
2,264

 
3,646

 
(544
)
State
142

 
404

 
(98
)
Foreign
(225
)
 
(430
)
 
830

 
$
35,791

 
$
30,593

 
$
20,003


 
Income and loss from operations before income taxes for the years ended December 31, 2014, 2013, and 2012, consisted of the following:

 (in thousands) 
 
Years Ended December 31,
 
2014
 
2013
 
2012
Domestic
$
90,142

 
$
74,912

 
$
65,705

Foreign
9,180

 
6,652

 
(3,784
)
 
$
99,322

 
$
81,564

 
$
61,921



Reconciliations between the statutory federal income tax rates and the Company’s effective income tax rates as a percentage of income before income taxes for its operations were as follows:

 (in thousands) 
 
Years Ended December 31,
 
2014
 
2013
 
2012
Federal tax rate
35.0
 %
 
35.0
 %
 
35.0
 %
State taxes, net of federal benefit
3.0
 %
 
3.0
 %
 
2.9
 %
Tax benefit of domestic manufacturing deduction
(2.4
)%
 
(2.2
)%
 
(2.1
)%
Change in valuation allowance
1.5
 %
 
1.3
 %
 
6.0
 %
Difference between United States statutory and foreign local tax rates
(0.4
)%
 
0.1
 %
 
2.6
 %
Change in uncertain tax position
(0.8
)%
 
(0.4
)%
 
(0.3
)%
Worthless stock deduction on Irish subsidiary
—
 %
 
—
 %
 
(15.4
)%
Non-deductible goodwill write-off
—
 %
 
—
 %
 
1.1
 %
Non-deductible professional fee
—
 %
 
—
 %
 
1.3
 %
Other
0.1
 %
 
0.7
 %
 
1.2
 %
Effective income tax rate
36.0
 %
 
37.5
 %
 
32.3
 %

 
In 2012, the Company recorded a worthless stock deduction for its investment in the Company’s wholly-owned Irish subsidiary. The deduction resulted in approximately $9.9 million tax benefit on the Company’s U.S. tax returns.
 
The tax effects of the significant temporary differences that constitute the deferred tax assets and liabilities at December 31, 2014 and 2013, were as follows:
 
(in thousands)
 
December 31,
 
2014
 
2013
Current deferred tax assets (liabilities)
 

 
 

State tax
$
1,685

 
$
1,415

Workers’ compensation
1,586

 
1,780

Health claims
651

 
601

Vacation liability
1,211

 
1,219

Allowance for doubtful accounts
156

 
181

Inventories
5,685

 
6,691

Sales incentive and advertising allowances
757

 
516

Stock-based compensation
3,197

 
2,913

Unrealized foreign exchange gain or loss
102

 
124

Other, net
(368
)
 
171

 
$
14,662

 
$
15,611

Long-term deferred tax assets (liabilities)
 

 
 

Depreciation
$
(3,913
)
 
$
(2,671
)
Goodwill and other intangibles amortization
(10,512
)
 
(9,781
)
Stock-based compensation
3,315

 
3,191

Accrued pension liabilities
1,276

 
—

Uncertain tax positions’ unrecognized tax benefits
623

 
1,532

Non-United States tax loss carry forward
6,506

 
5,472

Tax effect on cumulative translation adjustment
(789
)
 
(729
)
Other
796

 
940

 
(2,698
)
 
(2,046
)
Less valuation allowances
(6,754
)
 
(5,546
)
 
$
(9,452
)
 
$
(7,592
)

 
The total deferred tax assets for the years ended December 31, 2014 and 2013, were $22.0 million and $22.0 million, respectively. The total deferred tax liabilities for the years ended December 31, 2014 and 2013, were $16.8 million and $14.1 million, respectively.
 
At December 31, 2014, the Company had $28.0 million of pre-tax loss carryforwards in various non-United States taxing jurisdictions, which excludes approximately $11.8 million that was generated by the Company’s now inactive wholly owned Irish subsidiary. Tax loss carryforwards of $0.4 million, $0.8 million, $1.7 million, $1.6 million and $2.4 million will expire in 2015, 2016, 2017, 2018 and 2019, respectively, if not used. The remaining tax losses can be carried forward indefinitely.
 
At December 31, 2014, and 2013, the Company had deferred tax valuation allowances of $6.8 million and $5.5 million, respectively. The valuation allowance increased $1.3 million and decreased $4.2 million for the years ended December 31, 2014 and 2013, respectively. The decrease in valuation allowance from December 31, 2012, is mainly attributable to the removal of the deferred tax asset generated by the Company’s wholly owned Irish subsidiary.
 
The Company does not provide for federal income taxes on the undistributed earnings of its international subsidiaries because such earnings are reinvested and, in the Company’s opinion, will continue to be reinvested indefinitely. At December 31, 2014, 2013 and 2012, the Company had not provided for federal income taxes on undistributed earnings of $45.6 million, $34.8 million and $29.0 million, respectively, from its international subsidiaries. Should these earnings be distributed in the form of dividends or otherwise, the Company would be subject to both United States income taxes and withholding taxes in various international jurisdictions. These taxes may be partially offset by United States foreign tax credits. Determination of the related amount of unrecognized deferred United States income taxes is not practicable because of the complexities associated with this hypothetical calculation. United States federal income taxes are provided on the earnings of the Company’s foreign branches, which are included in the United States federal income tax return.
 
A reconciliation of the beginning and ending amounts of unrecognized tax benefits in 2014, 2013 and 2012 was as follows, including foreign translation amounts:
 
(in thousands) 
 
2014
 
2013
 
2012
Balance at January 1
$
3,456

 
$
3,843

 
$
4,683

Additions based on tax positions related to prior years
7

 
297

 
527

Reductions based on tax positions related to prior years
(1,146
)
 
(494
)
 
(1,163
)
Additions for tax positions of the current year
165

 
837

 
933

Settlements
(680
)
 
(435
)
 
(486
)
Lapse of statute of limitations
(495
)
 
(592
)
 
(651
)
Balance at December 31
$
1,307

 
$
3,456

 
$
3,843


 
Included in the balance of unrecognized tax benefits at December 31, 2014, 2013 and 2012, are tax positions of $0.0 million, $0.7 million and $0.9 million, respectively, which, if recognized, would reduce the effective tax rate.

The Company recognizes accrued interest and penalties related to unrecognized tax benefits in income tax expense, which is a continuation of the Company’s historical accounting policy. During the years ended December 31, 2014, 2013 and 2012, accrued interest decreased by $0.2 million, $0.3 million and $0.4 million, respectively, as a result of the reversal of accrued interest associated with the lapses of statutes of limitations. At December 31, 2014, 2013 and 2012, the Company had accrued $0.2 million, $0.4 million and $0.7 million, respectively, for the potential payment of interest, before income tax benefits.
 
At December 31, 2014, the Company remained subject to United States federal income tax examinations for the tax years 2011 through 2014. In addition, the Company remained subject to state, local and foreign income tax examinations primarily for the tax years 2009 through 2014.