Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

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Income Taxes (Tables)
 12 Months Ended
Dec. 31, 2021
Income Tax Disclosure [Abstract]  
Schedule of Earnings Before Income Taxes by Jurisdiction
The sources of Earnings before income taxes were as follows:
(in millions) 2021 2020 2019
United States $ 537.0  $ 354.5  $ 10.1 
Foreign 199.4  118.2  100.6 
Earnings before income taxes $ 736.4  $ 472.7  $ 110.7 
Schedule of Components of Income Tax Provision (Benefit)
The Income tax provision consisted of the following:
(in millions) 2021 2020 2019
Current tax expense:
U.S. Federal $ 84.3  $ 66.9  $ 94.5 
State and local 11.2  9.8  6.3 
Foreign 67.3  38.9  29.3 
Total current 162.8  115.6  130.1 
Deferred tax (benefit) expense:
U.S. Federal (4.9) (17.3) (19.7)
State and local (5.9) 1.1  (29.5)
Foreign (11.0) (1.4) (0.6)
Total deferred (21.8) (17.6) (49.8)
Income tax provision $ 141.0  $ 98.0  $ 80.3 
Schedule of Deferred Tax Assets and Liabilities
Temporary differences and carryforwards giving rise to deferred tax assets and liabilities as of December 31, 2021 and 2020 are summarized in the table below:
(in millions) 2021 2020
Deferred tax assets:
Loss carryforwards $ 92.6  $ 71.2 
Tax credit carryforwards 57.6  51.1 
Product warranties 28.1  28.1 
Compensation and benefits 26.9  20.9 
Deferred revenue 23.0  18.1 
Sales incentives and discounts 21.7  21.9 
Operating lease liabilities 15.7  16.3 
Equity compensation 13.8  12.0 
Deferred compensation 11.3  11.7 
Other 57.5  65.3 
Gross deferred tax assets 348.2  316.6 
Valuation allowance (97.9) (93.4)
Deferred tax assets 250.3  223.2 
Deferred tax liabilities:
Depreciation and amortization (59.3) (48.0)
State and local income taxes (22.7) (22.7)
Operating lease assets (14.4) (14.9)
Other (11.0) (6.3)
Deferred tax liabilities (107.4) (91.9)
Total net deferred tax assets $ 142.9  $ 131.3 
Reconciliation of Unrecognized Tax Benefits
The following is a reconciliation of the total amounts of unrecognized tax benefits excluding interest and penalties for the 2021, 2020 and 2019 annual reporting periods:
(in millions) 2021 2020 2019
Balance as of January 1 $ 3.7  $ 3.7  $ 2.3 
Gross increases - tax positions prior periods 5.9  0.1  2.0 
Gross decreases - tax positions prior periods (0.2) —  (0.8)
Gross increases - current period tax positions 0.5  0.6  0.4 
Decreases - settlements with taxing authorities (0.2) (0.1) — 
Reductions - lapse of statute of limitations —  (0.6) (0.2)
Balance as of December 31 $ 9.7  $ 3.7  $ 3.7 
Reconciliation of Income Taxes at the Statutory Federal Income Tax Rate to Income Tax Provision (Benefit)
The difference between the actual income tax provision and the tax provision computed by applying the statutory Federal income tax rate to Earnings before income taxes is attributable to the following:
(in millions) 2021 2020 2019
Income tax provision at 21 percent $ 154.6  $ 99.2  $ 23.2 
State and local income taxes, net of Federal income tax effect 18.0  11.6  (3.6)
Deferred tax asset valuation allowance (24.2) (0.2) (3.5)
Equity compensation (1.8) (1.1) (2.9)
Change in estimates related to prior years and prior years amended tax return filings 3.5  0.9  (2.9)
Federal and state tax credits (14.9) (12.0) (11.6)
Taxes related to foreign income, net of credits 5.5  0.7  (5.2)
Deferred tax reassessment 6.4  5.4  1.9 
FDII deduction (15.3) (11.4) (5.5)
Disproportionate tax effect released from Other comprehensive income —  —  91.4 
Other 9.2  4.9  (1.0)
Actual income tax provision $ 141.0  $ 98.0  $ 80.3 
Effective tax rate 19.1  % 20.7  % 72.6  %
Income Tax Provision (Benefit) Allocated to Continuing and Discontinued Operations
Income tax provision allocated to continuing operations and discontinued operations for the years ended December 31 was as follows:
(in millions) 2021 2020 2019
Continuing operations $ 141.0  $ 98.0  $ 80.3 
Discontinued operations 0.9  (0.5) (40.1)
Total income tax provision $ 141.9  $ 97.5  $ 40.2