INCOME TAXES (Tables)
|
12 Months Ended |
Dec. 31, 2017 |
|---|
| Income Tax Disclosure [Abstract] |
|
| Income Tax Expense Benefit |
The income tax expense (benefit) for the years ended December 31, 2017, 2016 and 2015 consists of the following (in millions):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017 |
|
2016 |
|
2015 |
Current: |
|
|
|
|
|
U.S. Federal |
$ |
671 |
|
|
$ |
1,338 |
|
|
$ |
1,634 |
|
U.S. State and Local |
49 |
|
|
67 |
|
|
88 |
|
Non-U.S. |
288 |
|
|
177 |
|
|
236 |
|
Total Current |
1,008 |
|
|
1,582 |
|
|
1,958 |
|
Deferred: |
|
|
|
|
|
U.S. Federal |
1,121 |
|
|
103 |
|
|
469 |
|
U.S. State and Local |
118 |
|
|
31 |
|
|
65 |
|
Non-U.S. |
(9 |
) |
|
(11 |
) |
|
6 |
|
Total Deferred |
1,230 |
|
|
123 |
|
|
540 |
|
Total Income Tax Expense |
$ |
2,238 |
|
|
$ |
1,705 |
|
|
$ |
2,498 |
|
|
| Income Before Income Taxes |
Income before income taxes includes the following components (in millions):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017 |
|
2016 |
|
2015 |
United States |
$ |
5,998 |
|
|
$ |
4,322 |
|
|
$ |
6,348 |
|
Non-U.S. |
1,150 |
|
|
814 |
|
|
994 |
|
Total Income Before Income Taxes: |
$ |
7,148 |
|
|
$ |
5,136 |
|
|
$ |
7,342 |
|
|
| 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, 2017, 2016 and 2015 consists of the following:
|
|
|
|
|
|
|
|
|
|
|
2017 |
|
2016 |
|
2015 |
Statutory U.S. federal income tax rate |
35.0 |
% |
|
35.0 |
% |
|
35.0 |
% |
U.S. state and local income taxes (net of federal benefit) |
1.5 |
|
|
1.5 |
|
|
1.7 |
|
Non-U.S. tax rate differential |
(2.0 |
) |
|
(2.4 |
) |
|
(1.2 |
) |
Nondeductible/nontaxable items |
(0.1 |
) |
|
0.8 |
|
|
0.2 |
|
U.S. federal tax credits |
(1.8 |
) |
|
(1.2 |
) |
|
(1.3 |
) |
Income tax benefit from the Tax Cuts and Jobs Act and other non-U.S. tax law changes |
(3.6 |
) |
|
— |
|
|
— |
|
Defined benefit plans mark-to-market charge tax rate differential (1)
|
1.5 |
|
|
— |
|
|
— |
|
Other |
0.8 |
|
|
(0.5 |
) |
|
(0.4 |
) |
Effective income tax rate |
31.3 |
% |
|
33.2 |
% |
|
34.0 |
% |
|
| Deferred Tax Liabilities and Assets |
Deferred income tax assets and liabilities are comprised of the following at December 31, 2017 and 2016 (in millions):
|
|
|
|
|
|
|
|
|
|
2017 |
|
2016 |
Fixed assets and capitalized software |
$ |
(3,288 |
) |
|
$ |
(4,782 |
) |
Other |
(535 |
) |
|
(756 |
) |
Deferred tax liabilities |
(3,823 |
) |
|
(5,538 |
) |
|
|
|
|
Pension and postretirement benefits |
1,877 |
|
|
4,236 |
|
Loss and credit carryforwards |
323 |
|
|
229 |
|
Insurance reserves |
449 |
|
|
733 |
|
Stock compensation |
182 |
|
|
297 |
|
Other |
626 |
|
|
681 |
|
Deferred tax assets |
3,457 |
|
|
6,176 |
|
Deferred tax assets valuation allowance |
(126 |
) |
|
(159 |
) |
Deferred tax asset (net of valuation allowance) |
3,331 |
|
|
6,017 |
|
|
|
|
|
Net deferred tax asset (liability) |
$ |
(492 |
) |
|
$ |
479 |
|
|
|
|
|
Amounts recognized in the consolidated balance sheets: |
|
|
|
Deferred tax assets |
$ |
265 |
|
|
$ |
591 |
|
Deferred tax liabilities |
(757 |
) |
|
(112 |
) |
Net deferred tax asset (liability) |
$ |
(492 |
) |
|
$ |
479 |
|
|
| U.S. State and Local Operating Loss and Credit Carryforwards |
In addition, we have U.S. state and local operating loss and credit carryforwards as follows (in millions):
|
|
|
|
|
|
|
|
|
|
2017 |
|
2016 |
U.S. state and local operating loss carryforwards |
$ |
1,215 |
|
|
$ |
603 |
|
U.S. state and local credit carryforwards |
$ |
83 |
|
|
$ |
70 |
|
|
| 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, 2015 |
$ |
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 |
|
Additions for tax positions of the current year |
17 |
|
|
— |
|
|
— |
|
Additions for tax positions of prior years |
20 |
|
|
10 |
|
|
— |
|
Reductions for tax positions of prior years for: |
|
|
|
|
|
Changes based on facts and circumstances |
(41 |
) |
|
(13 |
) |
|
— |
|
Settlements during the period |
— |
|
|
— |
|
|
— |
|
Lapses of applicable statute of limitations |
— |
|
|
— |
|
|
— |
|
Balance at December 31, 2016 |
144 |
|
|
50 |
|
|
6 |
|
Additions for tax positions of the current year |
16 |
|
|
— |
|
|
— |
|
Additions for tax positions of prior years |
33 |
|
|
14 |
|
|
3 |
|
Reductions for tax positions of prior years for: |
|
|
|
|
|
Changes based on facts and circumstances |
(24 |
) |
|
(18 |
) |
|
— |
|
Settlements during the period |
(6 |
) |
|
(3 |
) |
|
— |
|
Lapses of applicable statute of limitations |
(3 |
) |
|
— |
|
|
— |
|
Balance at December 31, 2017 |
$ |
160 |
|
|
$ |
43 |
|
|
$ |
9 |
|
|