8. Income Taxes

Income taxes were $25.0 million and $39.1 million for the three months ended March 31, 2020 and 2019, respectively. The effective income tax rate was 35.4% and 28.9% for the three months ended March 31, 2020 and 2019, respectively. The increase in the effective tax rate for the three months ended March 31, 2020 as compared to the same period in 2019 was primarily due to an unfavorable impact from discrete events, partially offset by changes in the geographic mix of the Company’s income. Included in the discrete events for the three months ended March 31, 2020 and 2019 was also the impact of $0.8 million of tax deficiencies and $2.4 million of excess tax benefits, respectively, from share-based compensation arrangements.

As of March 31, 2020, the total amount of unrecognized tax benefits, including related interest and penalties, was $56.9 million. If the total amount of unrecognized tax benefits was recognized, $38.0 million of unrecognized tax benefits, $8.3 million of interest, and $1.9 million of penalties would impact the effective tax rate.

The Company believes that it is reasonably possible that the amount of unrecognized tax benefits could decrease by up to approximately $7.2 million within the next twelve months. Of this possible decrease, $2.4 million would be due to the settlement of audits or resolution of administrative or judicial proceedings. The remaining possible decrease of $4.8 million would be due to the expiration of statute of limitations in various jurisdictions. For a description on contingency matters relating to income taxes, see Note 5, Contingencies.

On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act of 2017, or the Act. The Act, which is also commonly referred to as “U.S. Tax Reform,” significantly changed U.S. corporate income tax laws by, among other things, reducing the U.S. corporate income tax rate to 21% starting in 2018 and creating a modified territorial tax system with a one-time mandatory tax on previously deferred foreign earnings of U.S. subsidiaries. During both the fourth quarters of 2018 and 2017, the Company recorded valuation allowances related to its continued inability to fully utilize foreign tax credits generated. See Note 12, Income Taxes, to the Consolidated Financial Statements included in the 2019 10-K for additional discussion on U.S. Tax Reform.