Income Taxes

On December 22, 2017, the U.S. Tax Cuts and Jobs Act of 2017 (the “Tax Reform Act”) was signed, which includes a broad range of tax reform proposals affecting businesses, including corporate tax rates, business deductions, and international tax provisions.

On April 2, 2018, the Internal Revenue Service issued Notice 2018-26 which provides guidance on how to determine, report and pay the repatriation tax on deemed repatriated earnings of foreign subsidiaries provided in the Tax Reform Act and included in the consolidated financial statements for the year ended December 31, 2017. ASU 2018-26 is not expected to have a significant impact on the Company’s consolidated financial statements.

Income tax expense



	Three Months Ended March 31,
(in thousands, except percentages)	2018			2017
Effective tax rate	22.2		%	24.9		%
Provision for income taxes	$	7,253		$	7,680

Income tax expense decreased $0.4 million for the three months ended March 31, 2018, compared to the same period in 2017, due to a lower effective tax rate in spite of higher pre-tax income. The decrease in the effective tax rate was primarily due to the reduced U.S. corporate income tax rate from a maximum of 35% to a 21% rate provided in the Tax Reform Act. Although not significant, the Company’s effective tax rate includes the estimated incremental GILTI tax expense applying the tax law as currently enacted. The $23.1 million consolidated net income for the first quarter of 2017 included an $8.4 million gain on a bargain purchase of a business.