Polaris 2015 Annual Report Download - page 88

Amortization expense for intangible assets for the year ended December 31, 2015 and 2014 was $12,136,000
and $11,599,000. Estimated amortization expense for 2016 through 2020 is as follows: 2016, $13,000,000; 2017,
$13,000,000; 2018, $10,800,000; 2019, $9,200,000; 2020, $4,400,000; and after 2020, $2,800,000. The preceding
expected amortization expense is an estimate and actual amounts could differ due to additional intangible
asset acquisitions, changes in foreign currency rates or impairment of intangible assets.
Note 6. Income Taxes
Polaris’ income from continuing operations before income taxes was generated from its United States and
foreign operations as follows (in thousands):
For the Years Ended December 31,
2015 2014 2013
United States ................................. $640,604 $666,323 $535,265
Foreign ..................................... 45,133 32,994 39,164
Income from continuing operations before income taxes . . $685,737 $699,317 $574,429
Components of Polaris’ provision for income taxes for continuing operations are as follows (in thousands):
For the Years Ended December 31,
2015 2014 2013
Current:
Federal .................................. $211,017 $255,299 $167,690
State .................................... 16,609 20,438 12,942
Foreign .................................. 20,733 21,584 15,457
Deferred .................................... (17,983) (52,033) (2,729)
Total provision for income taxes for continuing operations $230,376 $245,288 $193,360
Reconciliation of the Federal statutory income tax rate to the effective tax rate is as follows:
For the Years Ended
December 31,
2015 2014 2013
Federal statutory rate ................................... 35.0% 35.0% 35.0%
State income taxes, net of federal benefit ..................... 1.5 1.5 1.5
Domestic manufacturing deduction ......................... (0.8) (1.1) (1.0)
Research and development tax credit ........................ (3.1) (1.1) (2.2)
Valuation allowance for foreign subsidiaries net operating losses .... 0.2 — 0.3
Other permanent differences .............................. 0.8 0.8 0.1
Effective income tax rate for continuing operations ............. 33.6% 35.1% 33.7%
In December 2015, the President of the United States signed the Consolidated Appropriations Act, 2016,
which retroactively reinstated the research and development tax credit for 2015, and also made the research
and development tax credit permanent. In addition to the 2015 research and development credits, the
Company filed amended returns to claim additional credits related to qualified research expenditures incurred
in prior years. In January 2013, the President of the United States signed the American Taxpayers Relief Act
of 2012, which reinstated the research and development tax credit. As a result, the impact of both the 2012
and 2013 research and development tax credits were recorded in the 2013 tax provision.
Undistributed earnings relating to certain non-U.S. subsidiaries of approximately $143,284,000 and
$105,782,000 at December 31, 2015 and 2014, respectively, are considered to be permanently reinvested;
accordingly, no provision for U.S. federal income taxes has been provided thereon. If the Company were to
64