Income Taxes

6 Months Ended

Jun. 29, 2019

Notes To Financial Statements [Abstract]

Income Taxes

INCOME TAXES

The Company recognized income tax expense of $51.6 million and $76.3 million for the three and six months ended June 29, 2019, resulting in an effective tax rate of 12.8% for both periods. Excluding the impacts of the acquisition-related and other

charges and the aforementioned Sargent & Greenleaf divestiture in the second quarter of 2019, the effective tax rates were 11.6% and 12.8% for the three and six months ended June 29, 2019, respectively. These effective tax rates differ from the U.S. statutory tax rate primarily due to tax on foreign earnings, the effective settlements of income tax audits, statute expirations and the re-measurement of uncertain tax position reserves.

The Company recognized income tax expense of $1.0 million and $82.7 million for the three and six months ended June 30, 2018, respectively, resulting in effective tax rates of 0.3% and 15.1%. Excluding the impacts of the EPA settlement charge in the second quarter of 2018, the tax charge recorded in the first quarter of 2018 related to the enactment of new U.S. tax legislation, and the acquisition-related charges, the effective tax rates were 7.0% and 13.4% for the three and six months ended June 30, 2018, respectively. These effective tax rates differed from the U.S. statutory tax rate primarily due to tax on foreign earnings and the effective settlements of income tax audits.

The Company is subject to examinations by taxing authorities in U.S. federal, state, and foreign jurisdictions. The Company considers many factors when evaluating and estimating its tax positions and the impact on income tax expense, which may require periodic adjustments, and which may not accurately anticipate actual outcomes. It is reasonably possible that the amount of the unrecognized benefit with respect to certain of the Company's unrecognized tax positions will significantly increase or decrease within the next 12 months. However, based on the uncertainties associated with litigation and the status of examinations, including the protocols of finalizing audits by the relevant tax authorities which could include formal legal proceedings, it is not possible to reasonably estimate the impact of any such change.