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INVACARE CORPORATION AND SUBSIDIAIRIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
FS-35
Income Taxes
Earnings (loss) from continuing operations before income taxes consist of the following (in thousands):
2015 2014 2013
Domestic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(54,812) $ (104,776) $ (73,529)
Foreign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43,072 41,566 30,070
$(11,740) $ (63,210) $ (43,459)
The company has provided for income taxes (benefits) from continuing operations as follows (in thousands):
2015 2014 2013
Current:
Federal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(167) $ (7,105) $ (2,485)
State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (150)(63) 300
Foreign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,439 15,105 11,043
11,122 7,937 8,858
Deferred:
Federal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,222 100 3,011
State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 318 — —
Foreign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 (2,487)(994)
3,588 (2,387) 2,017
Income Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 14,710 $ 5,550 $ 10,875
Included in the 2015, 2014 and 2013 Federal current tax benefit is a benefit of $140,000, $7,175,000 and $3,455,000,
respectively, related to an intra-period allocation to continuing operations. A charge in an equal amount is in discontinued operations.
A reconciliation to the effective income tax rate from the federal statutory rate is as follows:
2015 2014 2013
Statutory federal income tax rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (35.0)% (35.0)% (35.0)%
State and local income taxes, net of federal income tax benefit . . . . . . . . . . . . . . 0.9 (0.1) 0.5
Tax credits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (61.8) (5.1) (22.8)
Foreign taxes at less than the federal statutory rate (including tax holidays) . . . . (46.1) (10.7) (10.6)
Federal and foreign valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 168.0 52.5 35.8
Withholding taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.0 0.6 0.7
Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.6 0.1 0.5
Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100.1 12.3 54.6
Life insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2.7) 4.1 (1.5)
Foreign branch activity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (8.1) (1.8) (1.8)
Uncertain tax positions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.7 1.2 1.3
Other, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (0.3) (9.3) 3.3
125.3 % 8.8 % 25.0 %
Effective October 1, 2015, the company adopted ASU 2015-17, "Balance Sheet Classification of Deferred Taxes", on a
prospective basis, and thus the company's deferred tax assets and liabilities have been classified as long-term in its Balance Sheet
as of December 31, 2015. No prior periods were retrospectively adjusted.
At December 31, 2015, total deferred tax assets were $154,401,000, total deferred tax liabilities were $33,636,000 and the
tax valuation allowance total was $151,972,000 for a net deferred income tax liability of $31,207,000 compared to total deferred
tax assets of $137,511,000, total deferred tax liabilities of $33,778,000 and a tax valuation allowance total of $133,912,000 for a