Annual report pursuant to Section 13 and 15(d)

INCOME TAXES (Tables)

v3.3.1.900
INCOME TAXES (Tables)
 12 Months Ended
Dec. 31, 2015
Income Tax Disclosure [Abstract]  
Income Tax Expense Benefit
The income tax expense (benefit) for the years ended December 31 consists of the following (in millions):
 
2015
 
2014
 
2013
Current:
 
 
 
 
 
U.S. Federal
$
1,634

 
$
932

 
$
2,181

U.S. State and Local
88

 
103

 
205

Non-U.S.
236

 
185

 
162

Total Current
1,958

 
1,220

 
2,548

Deferred:
 
 
 
 
 
U.S. Federal
469

 
427

 
(242
)
U.S. State and Local
65

 
(11
)
 
(22
)
Non-U.S.
6

 
(31
)
 
18

Total Deferred
540

 
385

 
(246
)
Total Income Tax Expense
$
2,498

 
$
1,605

 
$
2,302

Income Before Income Taxes
Income before income taxes includes the following components (in millions):
 
2015
 
2014
 
2013
United States
$
6,348

 
$
3,819

 
$
6,040

Non-U.S.
994

 
818

 
634

Total Income Before Income Taxes:
$
7,342

 
$
4,637

 
$
6,674

Reconciliation of Statutory Federal Income Tax Rate to Effective Income Tax Rate
A reconciliation of the statutory federal income tax rate to the effective income tax rate for the years ended December 31 consists of the following:
 
2015
 
2014
 
2013
Statutory U.S. federal income tax rate
35.0
 %
 
35.0
 %
 
35.0
 %
U.S. state and local income taxes (net of federal benefit)
1.7

 
1.2

 
2.1

Non-U.S. tax rate differential
(1.2
)
 
(2.4
)
 
(1.3
)
Nondeductible/nontaxable items
0.2

 
1.3

 
(0.2
)
U.S. federal tax credits
(1.3
)
 
(1.5
)
 
(1.2
)
Other
(0.4
)
 
1.0

 
0.1

Effective income tax rate
34.0
 %
 
34.6
 %
 
34.5
 %
Deferred Tax Liabilities and Assets
Deferred tax liabilities and assets are comprised of the following at December 31 (in millions):
 
2015
 
2014
Fixed assets and capitalized software
$
(4,776
)
 
$
(4,816
)
Other
(699
)
 
(424
)
Deferred tax liabilities
(5,475
)
 
(5,240
)
 
 
 
 
Pension and postretirement benefits
3,915

 
4,722

Loss and credit carryforwards
261

 
250

Insurance reserves
730

 
745

Stock compensation
256

 
242

Other
650

 
630

Deferred tax assets
5,812

 
6,589

Deferred tax assets valuation allowance
(197
)
 
(208
)
Deferred tax asset (net of valuation allowance)
5,615

 
6,381

 
 
 
 
Net deferred tax asset
$
140

 
$
1,141

 
 
 
 
Amounts recognized in the consolidated balance sheets:
 
 
 
Non-current deferred tax assets
$
255

 
$
1,219

Non-current deferred tax liabilities
(115
)
 
(78
)
Net deferred tax asset
$
140

 
$
1,141

U.S. State and Local Operating Loss and Credit Carryforwards
We have U.S. state and local operating loss and credit carryforwards as follows (in millions):
 
2015
 
2014
U.S. state and local operating loss carryforwards
$
894

 
$
815

U.S. state and local credit carryforwards
$
53

 
$
52

Summarized Activity Related to Unrecognized Tax Benefits
The following table summarizes the activity related to our unrecognized tax benefits (in millions):
 
Tax
 
Interest
 
Penalties
Balance at January 1, 2013
$
232

 
$
53

 
$
4

Additions for tax positions of the current year
15

 
—

 
—

Additions for tax positions of prior years
20

 
9

 
2

Reductions for tax positions of prior years for:
 
 
 
 
 
Changes based on facts and circumstances
(67
)
 
(23
)
 
(1
)
Settlements during the period
(8
)
 
1

 
—

Lapses of applicable statute of limitations
(1
)
 
—

 
(1
)
Balance at December 31, 2013
191

 
40

 
4

Additions for tax positions of the current year
15

 
—

 
—

Additions for tax positions of prior years
51

 
13

 
—

Reductions for tax positions of prior years for:
 
 
 
 
 
Changes based on facts and circumstances
(74
)
 
(8
)
 
—

Settlements during the period
(10
)
 
(2
)
 
—

Lapses of applicable statute of limitations
(1
)
 
(1
)
 
(1
)
Balance at December 31, 2014
172

 
42

 
3

Additions for tax positions of the current year
24

 
—

 
—

Additions for tax positions of prior years
45

 
21

 
3

Reductions for tax positions of prior years for:
 
 
 
 
 
Changes based on facts and circumstances
(85
)
 
(8
)
 
—

Settlements during the period
(6
)
 
(2
)
 
—

Lapses of applicable statute of limitations
(2
)
 
—

 
—

Balance at December 31, 2015
$
148

 
$
53

 
$
6