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Income Taxes | 12 Months Ended
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Jan. 29, 2017
Income Tax Disclosure [Abstract] |
Income Taxes | INCOME TAXES The components of Earnings before Provision for Income Taxes for fiscal 2016, 2015 and 2014 were as follows (amounts in millions):
| Fiscal Year Ended
| January 29, 2017 |  | January 31, 2016 |  | February 1, 2015
United States | $ | 11,568 |  |  | $ | 10,207 |  |  | $ | 9,217 |
Foreign | 923 |  |  | 814 |  |  | 759 |
Total | $ | 12,491 |  |  | $ | 11,021 |  |  | $ | 9,976 |
The Provision for Income Taxes consisted of the following (amounts in millions):
| Fiscal Year Ended
| January 29, 2017 |  | January 31, 2016 |  | February 1, 2015
Current: |  |  |  |  |
Federal | $ | 3,870 |  |  | $ | 3,228 |  |  | $ | 2,884 |
State | 462 |  |  | 466 |  |  | 373 |
Foreign | 315 |  |  | 296 |  |  | 258 |
| 4,647 |  |  | 3,990 |  |  | 3,515 |
Deferred: |  |  |  |  |
Federal | (102 | ) |  | 21 |  |  | 127 |
State | 13 |  |  | 10 |  |  | (11 | )
Foreign | (24 | ) |  | (9 | ) |  | — |
| (113 | ) |  | 22 |  |  | 116 |
Total | $ | 4,534 |  |  | $ | 4,012 |  |  | $ | 3,631 |
The Company’s combined federal, state and foreign effective tax rates for fiscal 2016, 2015 and 2014 were approximately 36.3%, 36.4% and 36.4%, respectively. The reconciliation of the Provision for Income Taxes at the federal statutory rate of 35% to the actual tax expense for the applicable fiscal years was as follows (amounts in millions):
| Fiscal Year Ended
| January 29, 2017 |  | January 31, 2016 |  | February 1, 2015
Income taxes at federal statutory rate | $ | 4,372 |  |  | $ | 3,857 |  |  | $ | 3,492 |
State income taxes, net of federal income tax benefit | 309 |  |  | 309 |  |  | 235 |
Other, net | (147 | ) |  | (154 | ) |  | (96 | )
Total | $ | 4,534 |  |  | $ | 4,012 |  |  | $ | 3,631 |
The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities as of January 29, 2017 and January 31, 2016 were as follows (amounts in millions):
| January 29, 2017 |  | January 31, 2016
Assets: |  |  |
Deferred compensation | $ | 284 |  |  | $ | 269 |
Accrued self-insurance liabilities | 440 |  |  | 433 |
State income taxes | 152 |  |  | 140 |
Non-deductible reserves | 328 |  |  | 315 |
Net operating losses | 33 |  |  | 58 |
Other | 268 |  |  | 267 |
Total Deferred Tax Assets | 1,505 |  |  | 1,482 |
Valuation Allowance | (3 | ) |  | (3 | )
Total Deferred Tax Assets after Valuation Allowance | 1,502 |  |  | 1,479 |
Liabilities: |  |  |
Inventories | (64 | ) |  | (129 | )
Property and equipment | (1,128 | ) |  | (1,165 | )
Goodwill and other intangibles | (368 | ) |  | (368 | )
Other | (147 | ) |  | (116 | )
Total Deferred Tax Liabilities | (1,707 | ) |  | (1,778 | )
Net Deferred Tax Liabilities | $ | (205 | ) |  | $ | (299 | )
Noncurrent deferred tax assets and noncurrent deferred tax liabilities are netted by tax jurisdiction, and are included in the accompanying Consolidated Balance Sheets as follows (amounts in millions):
| January 29, 2017 |  | January 31, 2016
Other Assets | $ | 91 |  |  | $ | 80 |
Deferred Income Taxes | (296 | ) |  | (379 | )
Net Deferred Tax Liabilities | $ | (205 | ) |  | $ | (299 | )
The Company believes that the realization of the deferred tax assets is more likely than not, based upon the expectation that it will generate the necessary taxable income in future periods, and except for certain net operating losses discussed below, no valuation reserves have been provided. At January 29, 2017, the Company had federal, state and foreign net operating loss carryforwards available to reduce future taxable income, expiring at various dates beginning in 2017 to 2036. Management has concluded that it is more likely than not that the tax benefits related to the federal and state net operating losses will be realized. However, it is unlikely that the Company will be able to utilize certain foreign net operating losses. Therefore, a valuation allowance has been provided to reduce the deferred tax asset related to foreign net operating losses to an amount that is more likely than not to be realized. Total valuation allowances related to foreign net operating losses at January 29, 2017 and January 31, 2016 were $3 million and $3 million, respectively. The Company has not provided for deferred income taxes on approximately $4.2 billion of undistributed earnings of international subsidiaries because of its intention to indefinitely reinvest these earnings outside the U.S. The determination of the amount of the unrecognized deferred income tax liability related to the undistributed earnings is not practicable; however, unrecognized foreign income tax credits would be available to reduce a portion of this liability. The Company’s income tax returns are routinely examined by domestic and foreign tax authorities. For fiscal years 2005 through 2009, a transfer pricing issue remains open pending negotiations between the U.S. and Mexican tax authorities. The Company’s U.S. federal tax returns for fiscal years 2010 through 2012 are currently under examination by the IRS. During fiscal 2016, the IRS issued a proposed adjustment relating to the Company’s transfer pricing between its entities in the U.S. and China for fiscal years 2010 through 2012. The Company intends to defend its position using all available remedies including bi-lateral relief. There are also ongoing U.S. state and local and other foreign audits covering fiscal years 2005 through 2014. The Company does not expect the results from any ongoing income tax audit to have a material impact on the Company’s consolidated financial condition, results of operations or cash flows. Over the next twelve months, it is reasonably possible that the resolution of federal and state tax examinations could reduce the Company’s unrecognized tax benefits by $175 million. Final settlement of these audit issues may result in payments that are more or less than this amount, but the Company does not anticipate the resolution of these matters will result in a material change to its consolidated financial condition or results of operations. Reconciliations of the beginning and ending amount of gross unrecognized tax benefits for fiscal 2016, 2015 and 2014 were as follows (amounts in millions):
| January 29, 2017 |  | January 31, 2016 |  | February 1, 2015
Unrecognized tax benefits balance at beginning of fiscal year | $ | 689 |  |  | $ | 765 |  |  | $ | 790 |
Additions based on tax positions related to the current year | 147 |  |  | 169 |  |  | 179 |
Additions for tax positions of prior years | 14 |  |  | 126 |  |  | 34 |
Reductions for tax positions of prior years | (161 | ) |  | (350 | ) |  | (212 | )
Reductions due to settlements | (16 | ) |  | (14 | ) |  | (7 | )
Reductions due to lapse of statute of limitations | (14 | ) |  | (7 | ) |  | (19 | )
Unrecognized tax benefits balance at end of fiscal year | $ | 659 |  |  | $ | 689 |  |  | $ | 765 |
The amount of unrecognized tax benefits that if recognized would affect the annual effective income tax rate on Net Earnings was $382 million, $382 million and $318 million as of January 29, 2017, January 31, 2016 and February 1, 2015, respectively. Net adjustments to accruals for interest and penalties associated with uncertain tax positions resulted in expenses of $20 million, $5 million and $2 million in fiscal 2016, 2015 and 2014, respectively. Total accrued interest and penalties as of January 29, 2017 and January 31, 2016 were $109 million and $89 million, respectively. Interest and penalties are included in Interest Expense and SG&A, respectively, in the accompanying Consolidated Statements of Earnings.

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