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1047 - Disclosure - INCOME TAXES (Tables)
(http://www.allisontransmission.com/taxonomy/role/NotesToFinancialStatementsIncomeTaxDisclosureTextBlockTables)
TableStatement [Table]
Slicers (applies to each fact value in each table cell)
Reporting Entity [Axis]0001411207 (http://www.sec.gov/CIK)
Legal Entity [Axis]Entity [Domain]
Statement [Line Items]Period [Axis]
2016-01-01 - 2016-12-31
Income Loss Before Income Taxes

Income before income taxes included the following (dollars in millions):

 

     Years ended December 31,  
     2016      2015      2014  

U.S. income

    $ 309.4      $ 260.5      $ 355.1  

Foreign income

      31.9        28.3        13.0  
  

 

 

     

 

 

     

 

 

  

Total

    $ 341.3      $ 288.8      $ 368.1  
  

 

 

     

 

 

     

 

 

  
  
Provision for Income Tax Expense

The provision for income tax expense was estimated as follows (dollars in millions):

 

     Years ended December 31,  
     2016      2015      2014  

Estimated current income taxes:

         

U.S. federal

    $ 1.8      $ 3.0      $ 1.6  

Foreign

      8.6        5.4        6.3  

U.S. state and local

      1.8        2.1        (0.2 ) 
  

 

 

     

 

 

     

 

 

  

Total Current

      12.2        10.5        7.7  

Deferred income tax expense (credit), net:

         

U.S. federal

      106.6        89.7        125.6  

Foreign

      0.3        (0.1 )       (0.3 ) 

U.S. state and local

      7.3        6.4        6.5  
  

 

 

     

 

 

     

 

 

  

Total Deferred

      114.2        96.0        131.8  
  

 

 

     

 

 

     

 

 

  

Total income tax expense

    $ 126.4      $ 106.5      $ 139.5  
  

 

 

     

 

 

     

 

 

  
  
Reconciliation of Provision for Income Tax Expense

A reconciliation of the provision for income tax expense compared with the amounts at the U.S. federal statutory rate is as follows (dollars in millions):

 

     Years ended December 31,  
     2016      2015      2014  

Tax at U.S. statutory income tax rate

    $ 119.5      $ 101.1      $ 128.9  

Foreign rate differential

      (4.9 )       (3.0 )       (2.3 ) 

Non-deductible expenses

      4.6        3.9        3.9  

Valuation allowance

      1.2        (0.8 )       2.6  

State tax expense

      6.0        5.4        4.0  

Adjustment to deferred tax expense

      —          1.2        2.4  

Other adjustments

      (0.0 )       (1.3 )       (0.0 ) 
  

 

 

     

 

 

     

 

 

  

Total income tax expense

    $ 126.4      $ 106.5      $ 139.5  
  

 

 

     

 

 

     

 

 

  
  
Deferred Tax Assets and Liabilities

Temporary differences and carryforwards that gave rise to deferred tax assets and liabilities included the following (dollars in millions):

 

     As of
December 31,
2016		      As of
December 31,
2015		  

Deferred tax assets:

      

Inventories

    $ 5.7      $ 5.4  

Warranty accrual

      22.2        26.3  

Sales allowances and rebates

      6.5        6.8  

Deferred revenue

      34.6        29.4  

Post-retirement

      11.6        11.2  

Intangibles

      64.3        71.8  

Other accrued liabilities

      33.9        24.1  

Unrealized loss on interest rate derivatives

      11.1        13.4  

Operating loss carryforwards

      13.6        48.6  

Tax credits

      7.7        6.2  

Environmental remediation

      5.0        5.2  

Stock based compensation

      7.8        7.4  

Technology-related investments

      9.4        10.2  

Other

      9.1        13.8  
  

 

 

     

 

 

  

Total Deferred tax assets

      242.5        279.8  
  

 

 

     

 

 

  

Valuation allowances

      (5.3 )       (4.2 ) 
  

 

 

     

 

 

  

Deferred tax liabilities:

      

Property, plant and equipment

      (14.6 )       (19.0 ) 

Goodwill

      (408.7 )       (365.0 ) 

Trade name

      (121.6 )       (91.3 ) 

Other

      (2.2 )       (3.0 ) 
  

 

 

     

 

 

  

Total Deferred tax liabilities

      (547.1 )       (478.3 ) 
  

 

 

     

 

 

  

Net Deferred tax liability

    $ (309.9 )     $ (202.7 ) 
  

 

 

     

 

 

  
  
Liability for Unrecognized Tax Benefit

The change in the liability for unrecognized tax benefits are as follows (dollars in millions):

 

December 31, 2014

    $ 2.5  

Increases in unrecognized tax benefits as a result of current year activity

      —    

December 31, 2015

    $ 2.5  

Increases in unrecognized tax benefits as a result of current year activity

      —    
  

 

 

  

December 31, 2016

    $ 2.5