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INCOME TAXES (Tables)

12 Months Ended

Jun. 30, 2023

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,		2023				2022				2021
Current Taxes
U.S. federal		$	14,009			$	8,329			$	3,285
U.S. state and local			2,322				1,679				1,229
Foreign			6,678				6,672				5,467
Current taxes		$	23,009			$	16,680			$	9,981
Deferred Taxes
U.S. federal		$	(6,146	)		$	(4,815	)		$	25
U.S. state and local			(477	)			(1,062	)			(204	)
Foreign			564				175				29
Deferred taxes		$	(6,059	)		$	(5,702	)		$	(150	)
Provision for income taxes		$	16,950			$	10,978			$	9,831

Income Before Income Taxes

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

(In millions)
Year Ended June 30,		2023				2022				2021
U.S.		$	52,917			$	47,837			$	34,972
Foreign			36,394				35,879				36,130
Income before income taxes		$	89,311			$	83,716			$	71,102

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,		2023				2022				2021
Federal statutory rate			21.0%				21.0%				21.0%
Effect of:
Foreign earnings taxed at lower rates			(1.8)%				(1.3)%				(2.7)%
Impact of intangible property transfers			0%				(3.9)%				0%
Foreign-derived intangible income deduction			(1.3)%				(1.1)%				(1.3)%
State income taxes, net of federal benefit			1.6%				1.4%				1.4%
Research and development credit			(1.1)%				(0.9)%				(0.9)%
Excess tax benefits relating to stock-based compensation			(0.7)%				(1.9)%				(2.4)%
Interest, net			0.8%				0.5%				0.5%
Other reconciling items, net			0.5%				(0.7)%				(1.8)%
Effective rate			19.0%				13.1%				13.8%

Deferred Income Tax Assets and Liabilities

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

(In millions)
June 30,		2023				2022
Deferred Income Tax Assets
Stock-based compensation expense		$	681			$	601
Accruals, reserves, and other expenses			3,131				2,874
Loss and credit carryforwards			1,441				1,546
Amortization (a)			9,440				10,183
Leasing liabilities			5,041				4,557
Unearned revenue			3,296				2,876
Book/tax basis differences in investments and debt			373				0
Capitalized research and development (a)			6,958				473
Other			489				461
Deferred income tax assets			30,850				23,571
Less valuation allowance			(939	)			(1,012	)
Deferred income tax assets, net of valuation allowance		$	29,911			$	22,559
Deferred Income Tax Liabilities
Book/tax basis differences in investments and debt		$	0			$	(174	)
Leasing assets			(4,680	)			(4,291	)
Depreciation			(2,674	)			(1,602	)
Deferred tax on foreign earnings			(2,738	)			(3,104	)
Other			(89	)			(103	)
Deferred income tax liabilities		$	(10,181	)		$	(9,274	)
Net deferred income tax assets		$	19,730			$	13,285
Reported As
Other long-term assets		$	20,163			$	13,515
Long-term deferred income tax liabilities			(433	)			(230	)
Net deferred income tax assets		$	19,730			$	13,285

(a)Provisions enacted in the TCJA related to the capitalization for tax purposes of research and development expenditures became effective on July 1, 2022. These provisions require us to capitalize research and development expenditures and amortize them on our U.S. tax return over five or fifteen years, depending on where research is conducted.

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,		2023				2022				2021
Beginning unrecognized tax benefits		$	15,593			$	14,550			$	13,792
Decreases related to settlements			(329	)			(317	)			(195	)
Increases for tax positions related to the current year			1,051				1,145				790
Increases for tax positions related to prior years			870				461				461
Decreases for tax positions related to prior years			(60	)			(246	)			(297	)
Decreases due to lapsed statutes of limitations			(5	)			0				(1	)
Ending unrecognized tax benefits		$	17,120			$	15,593			$	14,550

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