Annual report pursuant to Section 13 and 15(d)

INCOME TAXES (Tables)

v3.20.4
INCOME TAXES (Tables)
12 Months Ended
Dec. 31, 2020
Income Tax Disclosure [Abstract]  
Provision for Income Taxes
The provision from (benefit for) income taxes consisted of the following:  
  Twelve Months Ended December 31,
  2020 2019 2018
  (In millions)
Current:      
Federal $ 34.8  $ (5.2) $ 9.0 
State 24.0  8.5  11.4 
Foreign 33.7  43.7  31.5 
  92.5  47.0  51.9 
Deferred:      
Federal 40.6  (48.2) 25.4 
State (0.1) (11.3) 1.6 
Foreign 26.0  (23.2) (25.5)
  66.5  (82.7) 1.5 
Provision from (benefit for) income taxes $ 159.0  $ (35.7) $ 53.4 
Domestic and Foreign Income before Income Taxes
Domestic and foreign income (loss) before income taxes was as follows:
  Twelve Months Ended December 31,
  2020 2019 2018
  (In millions)
U.S. $ 470.3  $ (522.7) $ 354.3 
Foreign 214.9  108.9  16.1 
  $ 685.2  $ (413.8) $ 370.4 
Provision for Income Taxes Reconciles with U.S. Federal Statutory Rate
The provision from (benefit for) income taxes reconciles with the U.S. federal statutory rate, as follows:
  Twelve Months Ended December 31,
  2020 2019 2018
  (In millions)
Federal statutory rate 21.0  % 21.0  % 21.0  %
Provision computed at federal statutory rate $ 143.9  $ (86.9) $ 77.8 
State and local taxes, net of federal tax benefit 17.8  (6.3) 11.2 
Foreign 5.5  (2.7) — 
Federal research & development credit (15.9) (14.9) (13.0)
Equity compensation (6.0) (3.0) (7.5)
Tax reserves 1.4  1.2  2.4 
Australia settlement   —  (14.1)
Legal settlement 0.1  69.1  — 
Excess officer’s compensation 5.8  5.1  2.7 
Valuation Allowance 7.8  —  — 
Other (1.4) 2.7  (6.1)
Provision from (benefit for) income taxes $ 159.0  $ (35.7) $ 53.4 
Effective income tax rate 23.2  % 8.6  % 14.4  %
Components of Deferred Income Tax Assets and Liabilities
Components of the deferred income tax assets and liabilities at December 31, 2020 and 2019, were as follows:
  December 31,
  2020 2019
  (In millions)
Deferred income tax assets:    
Net operating and capital loss carryforwards $ 286.1  $ 285.1 
Goodwill and intangible assets 128.0  119.1 
Employee compensation programs 62.7  40.5 
Foreign tax credits 17.4  16.6 
Employee pension benefits 34.6  31.1 
Reserves and accrued expenses 17.6  14.9 
Accrued legal expense 94.9  136.3 
Research and development costs 33.0  32.4 
Operating lease asset 23.1  26.6 
Other 11.8  18.3 
Gross deferred income tax assets 709.2  720.9 
Valuation allowance (382.7) (379.8)
Total deferred income tax assets, net 326.5  341.1 
Deferred income tax liabilities:    
Goodwill and intangible assets (540.7) (472.5)
Undistributed earnings of foreign subsidiaries (11.3) (8.3)
Depreciation (19.1) (33.6)
Operating lease liability (23.1) (26.6)
Accrued insurance   (27.5)
Prepaid expenses (11.6) (8.1)
Investment basis difference (41.5) (1.2)
Other (2.3) (2.1)
Total deferred income tax liability (649.6) (579.9)
Net deferred income tax liability $ (323.1) $ (238.8)
Deferred Income Tax Assets, Included in Other Current Assets, and Liabilities
Our deferred income tax assets and deferred income tax liabilities at December 31, 2020 and 2019, are included in the accompanying Consolidated Balance Sheets as follows:
  December 31,
  2020 2019
  (In millions)
Long-term deferred income tax assets, included in other assets $ 9.2  $ 9.2 
Long-term deferred income tax liabilities (332.3) (248.0)
Net deferred income tax liability $ (323.1) $ (238.8)
Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

  2020 2019
  (In millions)
Beginning balance (January 1) $ 27.5  $ 25.9 
Increases related to prior year tax positions 12.7  2.0 
Decreases related to prior year tax positions (0.1) (0.1)
Increases related to current year tax positions 9.1  7.2 
Decreases related to settlements (0.2) (1.3)
Expiration of the statute of limitations for the assessment of taxes (7.2) (5.9)
Currency translation adjustment (0.3) (0.3)
Ending balance (December 31) $ 41.5  $ 27.5