8. Income Taxes

Income taxes were $9.4 million for the three months ended March 31, 2018, as compared to $28.4 million for the same period in 2017. The effective income tax rate was 10.3% for the three months ended March 31, 2018, as compared to 25.0% for the same period in 2017. The decrease in the effective tax rate for the three months ended March 31, 2018, as compared to the same period in 2017, was primarily due to the increase in net benefits from discrete events, in addition to the impact of changes in the geographic mix of the Company’s income. Included in the discrete events for the three months ended March 31, 2018 and 2017 was the impact of $19.4 million and $4.3 million, respectively, of excess tax benefits on share-based compensation arrangements.

As of March 31, 2018, the total amount of unrecognized tax benefits, including related interest and penalties, was $61.7 million. If the total amount of unrecognized tax benefits was recognized, $44.2 million of unrecognized tax benefits, $9.6 million of interest, and $1.4 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 $9.1 million within the next twelve months. Of this possible decrease, $0.7 million would be due to the settlement of audits or resolution of administrative or judicial proceedings. The remaining possible decrease of $8.4 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.

As described in Note 12, Income Taxes, to the Consolidated Financial Statements included in the 2017 10-K, on December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act, or the Act. The Act, which is also commonly referred to as “U.S. Tax Reform,” significantly changes 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. As a result of the Act, the Company recorded a provisional net expense during the fourth quarter of 2017 which was reflected in its prior year financial statements. There have not been any adjustments to these provisional amounts during the three months ended March 31, 2018. The Company continues to analyze other information and regulatory guidance, and accordingly the Company may record additional provisional amounts or adjustments to provisional amounts in future periods. Pursuant to the SEC’s Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act, any adjustments to these provisional amounts will be reported as a component of tax expense in the reporting period in which any such adjustments are determined, which will be no later than the fourth quarter of 2018.