Harbinger Group Inc.
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SEC Filings

10-K
HRG GROUP, INC. filed this Form 10-K on 11/23/2016
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NOTE 14 - INCOME TAXES
Income tax expense was calculated based upon the following components of income (loss) from operations before income taxes for the years ended September 30, 2016, 2015, and 2014:
 
 
SBH
 
SB/RH
(in millions)
 
2016
 
2015
 
2014
 
2016
 
2015
 
2014
United States
 
$
197.8

 
$
3.4

 
$
80.7

 
$
203.5

 
$
9.8

 
$
83.3

Outside the United States
 
199.8

 
189.9

 
192.8

 
199.8

 
189.9

 
192.8

Income (loss) from operations before income taxes
 
$
397.6

 
$
193.3

 
$
273.5

 
$
403.3

 
$
199.7

 
$
276.1

The components of income tax expense for the years ended September 30, 2016, 2015 and 2014 are as follows:
 
 
SBH
 
SB/RH
(in millions)
 
2016
 
2015
 
2014
 
2016
 
2015
 
2014
Current tax expense:
 
 
 
 
 
 
 
 
 
 
 
 
U.S. Federal
 
$
1.6

 
$
3.6

 
$
6.2

 
$
1.6

 
$
3.6

 
$
6.2

Foreign
 
59.7

 
40.4

 
46.6

 
59.7

 
40.4

 
46.6

State and local
 
4.2

 
4.5

 
4.3

 
4.2

 
4.5

 
4.3

Total current tax expense
 
65.5

 
48.5

 
57.1

 
65.5

 
48.5

 
57.1

Deferred tax (benefit) expense:
 
 
 
 
 
 
 
 
 
 
 
 
U.S. Federal
 
(27.2
)
 
(12.3
)
 
19.7

 
(16.7
)
 
(12.3
)
 
19.7

Foreign
 
(1.1
)
 
11.2

 
(8.2
)
 
(1.1
)
 
11.2

 
(8.2
)
State and local
 
2.8

 
(3.5
)
 
(9.6
)
 
3.3

 
(3.5
)
 
(9.6
)
Total deferred tax expense
 
(25.5
)
 
(4.6
)
 
1.9

 
(14.5
)
 
(4.6
)
 
1.9

Income tax expense
 
$
40.0

 
$
43.9

 
$
59.0

 
$
51.0

 
$
43.9

 
$
59.0

The following reconciles the total income tax expense, based on the U.S. Federal statutory income tax rate of 35%, with the Company’s recognized income tax expense:
 
 
SBH
 
SB/RH
(in millions)
 
2016
 
2015
 
2014
 
2016
 
2015
 
2014
U.S. Statutory federal income tax expense
 
$
139.2

 
$
67.6

 
$
95.7

 
$
141.2

 
$
69.9

 
$
96.6

Permanent items
 
9.1

 
5.2

 
4.6

 
9.1

 
5.2

 
4.6

Foreign statutory rate vs. U.S. statutory rate
 
(38.9
)
 
(33.8
)
 
(28.7
)
 
(38.9
)
 
(33.8
)
 
(28.7
)
State income taxes, net of federal effect
 
4.6

 
1.7

 
5.4

 
4.7

 
1.7

 
5.4

Residual tax on foreign earnings
 
19.7

 
24.8

 
90.9

 
19.7

 
24.8

 
90.9

Investment in foreign subsidiary
 

 
(23.3
)
 

 

 
(23.3
)
 

Purchase accounting benefit
 

 
(22.8
)
 

 

 
(22.8
)
 

Benefit from adjustment to tax basis in assets
 
(8.4
)
 

 

 
(8.4
)
 

 

Change in valuation allowance
 
(91.3
)
 
2.6

 
(115.6
)
 
(82.7
)
 
0.5

 
(116.5
)
Unrecognized tax expense (benefit)
 
34.6

 
(1.2
)
 
0.5

 
34.6

 
(1.2
)
 
0.5

Foreign tax law changes
 
(3.7
)
 

 
(7.6
)
 
(3.7
)
 

 
(7.6
)
Share based compensation adjustments
 
(2.8
)
 
2.3

 
1.4

 
(2.8
)
 
2.3

 
1.4

Impact of IRC Section 9100 relief
 
(16.4
)
 

 

 
(16.4
)
 

 

Adjustment to prior year NOLs
 

 
14.4

 

 

 
14.4

 

Return to provision adjustments and other, net
 
(5.7
)
 
6.4

 
12.4

 
(5.4
)
 
6.2

 
12.4

Income tax expense
 
$
40.0

 
$
43.9

 
$
59.0

 
$
51.0

 
$
43.9

 
$
59.0


S-41

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