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SEC Filings

10-K
INTERPUBLIC GROUP OF COMPANIES, INC. filed this Form 10-K on 02/22/2016
Entire Document
 
Notes to Consolidated Financial Statements – (continued)
(Amounts in Millions, Except Per Share Amounts)

The provision for income taxes is listed below.
 
Years ended December 31,
 
2015
 
2014
 
2013
U.S. federal income taxes (including foreign withholding taxes):
 
 
 
 
 
Current
$
117.8

 
$
8.0

 
$
46.9

Deferred
46.9

 
130.7

 
25.2

 
164.7

 
138.7

 
72.1

State and local income taxes:
 
 
 
 
 
Current
15.1

 
9.7

 
(14.7
)
Deferred
13.0

 
23.8

 
24.7

 
28.1

 
33.5

 
10.0

Foreign income taxes:
 
 
 
 
 
Current
100.4

 
115.3

 
79.6

Deferred
(10.4
)
 
(71.0
)
 
19.5

 
90.0

 
44.3

 
99.1

Total
$
282.8

 
$
216.5

 
$
181.2

A reconciliation of the effective income tax rate as reflected in our Consolidated Statements of Operations to the U.S. federal statutory income tax rate is listed below.
 
Years ended December 31,
 
2015
 
2014
 
2013
U.S. federal statutory income tax rate
35.0
%
 
35.0
%
 
35.0
%
 
 
 
 
 
 
Income tax provision at U.S. federal statutory rate
$
266.8

 
$
252.3

 
$
163.8

State and local income taxes, net of federal income tax benefit
18.3

 
21.4

 
6.5

Impact of foreign operations, including withholding taxes
16.1

 
1.7

 
30.5

Change in net valuation allowance 1
(20.6
)
 
(66.0
)
 
3.2

Worthless securities deduction
0.0

 
0.0

 
(22.2
)
Divestitures
11.9

 
0.0

 
0.0

Other
(9.7
)
 
7.1

 
(0.6
)
Provision for income taxes
$
282.8

 
$
216.5

 
$
181.2

 
 
 
 
 
 
Effective income tax rate on operations
37.1
%
 
30.0
%
 
38.7
%
 
1
Reflects changes in valuation allowance that impacted the effective income tax rate for each year presented.
In 2015, our effective income tax rate of 37.1% was negatively impacted primarily by losses in certain foreign jurisdictions where we receive no tax benefit due to 100% valuation allowances and from the losses on sales of businesses for which we did not receive a full tax benefit. The negative impacts to our tax rates were partially offset by the recognition of previously unrecognized tax benefits as a result of the reversal of valuation allowances in Continental Europe and the settlement of the 2010 U.S. federal income tax audit.
In 2014, our effective income tax rate of 30.0% was positively impacted from changes to our valuation allowances of $66.0. The primary drivers of the net change were associated with a valuation allowance reversal of $124.8 in one jurisdiction partially offset by the establishment of a valuation allowance of $57.2 in another jurisdiction, both in Continental Europe. In addition, our effective income tax rate was negatively impacted by losses in certain foreign jurisdictions where we receive no tax benefit due to 100% valuation allowances.
In 2013, our effective income tax rate of 38.7% was positively impacted by the recognition of previously unrecognized tax benefits as a result of the recognition of losses attributable to worthless securities in a consolidated subsidiary and the settlement of the 2002-2006 New York State audit cycle. Our effective income tax rate was negatively impacted primarily by losses in certain foreign jurisdictions where we receive no tax benefit due to 100% valuation allowances.

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