Income Taxes

The Company’s corporate organizational structure requires the filing of two separate consolidated U.S. Federal income tax returns. Taxable income of one group cannot be offset by tax attributes, including net operating losses, of the other group.

A reconciliation of the U.S. federal statutory tax rate to the Company’s effective income tax rate is as follows:



	Three months ended September 30,				Nine months ended September 30,
	2015		2014		2015		2014
U.S. federal statutory tax rate	35.0	%	35.0	%	35.0	%	35.0	%
State income taxes, net of federal benefit	5.7		1.8		(1.8	)	2.1
Non-U.S. income taxed at different rates	(29.1	)	—		4.2		—
Non-deductible expenses	0.2		(0.2	)	(2.4	)	0.1
Domestic production activities deduction	3.6		(1.9	)	—		(2.4	)
Return to accrual adjustments	—		(4.9	)	—		(1.8	)
Other	1.4		—		(0.1	)	—
Effective income tax rate	16.8	%	29.8	%	34.9	%	33.0	%

The change in the effective income tax rate for the three and nine months ended September 30, 2015, compared to the three and nine months ended September 30, 2014, was primarily due to the mix of pre-tax profit and loss between domestic and international taxing jurisdictions in 2015 and the effect of a decrease in deferred tax liabilities related to a change in state tax apportionment in 2014. The Company plans to permanently reinvest profits from international operations into opportunities to expand the Company’s international presence.

Deferred taxes are presented in the balance sheets as follows (in thousands):



	September 30, 2015			December 31, 2014
Current deferred tax assets	$	1,835		$	2,696
Non-current deferred tax assets	19,392			12,907
Non-current deferred tax liabilities	(22,910		)	(25,982		)
Net deferred tax assets (liabilities)	$	(1,683	)	$	(10,379	)