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INCOME TAXES (Tables)

12 Months Ended

Jun. 30, 2022

Income Tax Disclosure [Abstract]

Provision for Income Taxes

The components of the provision for income taxes were as follows:

(In millions)
Year Ended June 30,		2022				2021				2020
Current Taxes
U.S. federal		$	8,329			$	3,285			$	3,537
U.S. state and local			1,679				1,229				763
Foreign			6,672				5,467				4,444
Current taxes		$	16,680			$	9,981			$	8,744
Deferred Taxes
U.S. federal		$	(4,815	)		$	25			$	58
U.S. state and local			(1,062	)			(204	)			(6	)
Foreign			175				29				(41	)
Deferred taxes		$	(5,702	)		$	(150	)		$	11
Provision for income taxes		$	10,978			$	9,831			$	8,755

Income Before Income Taxes

U.S. and foreign components of income before income taxes were as follows:

(In millions)
Year Ended June 30,		2022				2021				2020
U.S.		$	47,837			$	34,972			$	24,116
Foreign			35,879				36,130				28,920
Income before income taxes		$	83,716			$	71,102			$	53,036

Difference Between Income Taxes Computed at Federal Statutory Rate and Provision for Income Taxes

The items accounting for the difference between income taxes computed at the U.S. federal statutory rate and our effective rate were as follows:

Year Ended June 30,		2022				2021				2020
Federal statutory rate			21.0	%			21.0	%			21.0	%
Effect of:
Foreign earnings taxed at lower rates			(1.3)	%			(2.7)	%			(3.7)	%
Impact of intangible property transfers			(3.9)	%			0	%			0	%
Foreign-derived intangible income deduction			(1.1)	%			(1.3)	%			(1.1)	%
State income taxes, net of federal benefit			1.4	%			1.4	%			1.3	%
Research and development credit			(0.9)	%			(0.9)	%			(1.1)	%
Excess tax benefits relating to stock-based compensation			(1.9)	%			(2.4)	%			(2.2)	%
Interest, net			0.5	%			0.5	%			1.0	%
Other reconciling items, net			(0.7)	%			(1.8)	%			1.3	%
Effective rate			13.1	%			13.8	%			16.5	%

Deferred Income Tax Assets and Liabilities

The components of the deferred income tax assets and liabilities were as follows:  

(In millions)
June 30,		2022				2021
Deferred Income Tax Assets
Stock-based compensation expense		$	601			$	502
Accruals, reserves, and other expenses			2,874				2,960
Loss and credit carryforwards			1,546				1,090
Amortization			10,656				6,346
Leasing liabilities			4,557				4,060
Unearned revenue			2,876				2,659
Other			461				319
Deferred income tax assets			23,571				17,936
Less valuation allowance			(1,012	)			(769	)
Deferred income tax assets, net of valuation allowance		$	22,559			$	17,167
Deferred Income Tax Liabilities
Book/tax basis differences in investments and debt		$	(174	)		$	(2,381	)
Leasing assets			(4,291	)			(3,834	)
Depreciation			(1,602	)			(1,010	)
Deferred tax on foreign earnings			(3,104	)			(2,815	)
Other			(103	)			(144	)
Deferred income tax liabilities		$	(9,274	)		$	(10,184	)
Net deferred income tax assets		$	13,285			$	6,983
Reported As
Other long-term assets		$	13,515			$	7,181
Long-term deferred income tax liabilities			(230	)			(198	)
Net deferred income tax assets		$	13,285			$	6,983

Changes in Gross Unrecognized Tax Benefits Related to Uncertain Tax Positions

The aggregate changes in the gross unrecognized tax benefits related to uncertain tax positions were as follows:

(In millions)
Year Ended June 30,		2022				2021				2020
Beginning unrecognized tax benefits		$	14,550			$	13,792			$	13,146
Decreases related to settlements			(317	)			(195	)			(31	)
Increases for tax positions related to the current year			1,145				790				647
Increases for tax positions related to prior years			461				461				366
Decreases for tax positions related to prior years			(246	)			(297	)			(331	)
Decreases due to lapsed statutes of limitations			0				(1	)			(5	)
Ending unrecognized tax benefits		$	15,593			$	14,550			$	13,792

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Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets.

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Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

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