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Income Taxes | 12 Months Ended
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Jan. 31, 2021
Income Tax Disclosure [Abstract] |
Income Taxes | INCOME TAXES Provision for Income Taxes Our earnings before the provision for income taxes follow:
in millions | Fiscal |  | Fiscal |  | Fiscal
2020 |  | 2019 |  | 2018
United States | $ | 16,013 |  |  | $ | 13,770 |  |  | $ | 13,456 |
Foreign | 965 |  |  | 945 |  |  | 1,100 |
Total | $ | 16,978 |  |  | $ | 14,715 |  |  | $ | 14,556 |
Our provision for income taxes follows:
in millions | Fiscal |  | Fiscal |  | Fiscal
2020 |  | 2019 |  | 2018
Current: |  |  |  |  |
Federal | $ | 3,462 |  |  | $ | 2,370 |  |  | $ | 2,495 |
State | 928 |  |  | 572 |  |  | 544 |
Foreign | 329 |  |  | 340 |  |  | 372 |
Total current | 4,719 |  |  | 3,282 |  |  | 3,411 |
Deferred: |  |  |  |  |
Federal | (404) |  |  | 259 |  |  | 67 |
State | (209) |  |  | (72) |  |  | 1 |
Foreign | 6 |  |  | 4 |  |  | (44) |
Total deferred | (607) |  |  | 191 |  |  | 24 |
Provision for income taxes | $ | 4,112 |  |  | $ | 3,473 |  |  | $ | 3,435 |
Our combined federal, state, and foreign effective tax rates follow:
| Fiscal |  | Fiscal |  | Fiscal
| 2020 |  | 2019 |  | 2018
Combined federal, state, and foreign effective tax rates | 24.2 | % |  | 23.6 | % |  | 23.6 | %
The reconciliation of our provision for income taxes at the federal statutory rate of 21% to the actual tax expense follows:
in millions | Fiscal |  | Fiscal |  | Fiscal
2020 |  | 2019 |  | 2018
Income taxes at federal statutory rate | $ | 3,565 |  |  | $ | 3,090 |  |  | $ | 3,057 |
State income taxes, net of federal income tax benefit | 568 |  |  | 395 |  |  | 443 |
Tax on mandatory deemed repatriation | — |  |  | — |  |  | (62) |
Other, net | (21) |  |  | (12) |  |  | (3) |
Total | $ | 4,112 |  |  | $ | 3,473 |  |  | $ | 3,435 |
Deferred Taxes The tax effects of temporary differences that give rise to significant portions of our deferred tax assets and deferred tax liabilities follow:
in millions | January 31, 2021 |  | February 2, 2020
Assets: |  |  |
Deferred compensation | $ | 472 |  |  | $ | 169 |
Accrued self-insurance liabilities | 291 |  |  | 285 |
State income taxes | 117 |  |  | 100 |
Merchandise inventories | 41 |  |  | — |
Non-deductible reserves | 199 |  |  | 156 |
Net operating losses | 144 |  |  | 70 |
Lease liabilities | 1,605 |  |  | 1,536 |
Other | 155 |  |  | 135 |
Total deferred tax assets | 3,024 |  |  | 2,451 |
Valuation allowance | (8) |  |  | — |
Total deferred tax assets, net of valuation allowance | 3,016 |  |  | 2,451 |
Liabilities: |  |  |
Merchandise inventories | — |  |  | (26) |
Property and equipment | (1,061) |  |  | (1,107) |
Goodwill and other intangibles | (1,030) |  |  | (195) |
Lease right-of-use assets | (1,555) |  |  | (1,458) |
Tax on unremitted earnings | (119) |  |  | (100) |
Other | (77) |  |  | (132) |
Total deferred tax liabilities | (3,842) |  |  | (3,018) |
Net deferred tax liabilities | $ | (826) |  |  | $ | (567) |
Our noncurrent deferred tax assets and noncurrent deferred tax liabilities, netted by tax jurisdiction, follow:
in millions | January 31, 2021 |  | February 2, 2020
Other assets | $ | 305 |  |  | $ | 139 |
Deferred income taxes | (1,131) |  |  | (706) |
Net deferred tax liabilities | $ | (826) |  |  | $ | (567) |
As of January 31, 2021, we recorded deferred tax assets of $144 million for net operating losses, primarily related to state jurisdictions. These losses expire at various dates beginning in 2022. We have concluded that it is more likely than not that tax benefits related to substantially all net operating losses will be realized based upon the expectation that we will generate the necessary taxable income in future periods. Reinvestment of Unremitted Earnings Substantially all of our current year foreign cash flows in excess of working capital and cash needed for strategic investments are not intended to be indefinitely reinvested offshore. Therefore, the tax effects of repatriation (including applicable state and local taxes and foreign withholding taxes) of such cash flows have been provided for in the accompanying consolidated statements of earnings. We have the intent and ability to reinvest substantially all of the approximately $3 billion of non-cash unremitted earnings of our non-U.S. subsidiaries indefinitely. Accordingly, no provision for state and local taxes or foreign withholding taxes was recorded on these unremitted earnings in the accompanying consolidated statements of earnings. It is impracticable for us to determine the amount of unrecognized deferred tax liabilities on these indefinitely reinvested earnings due to the complexities associated with the hypothetical calculation. Tax Return Examination Status Our income tax returns are routinely examined by U.S. federal, state and local, and foreign tax authorities. With few exceptions, as of January 31, 2021, the Company is no longer subject to U.S. federal examinations by tax authorities for years before fiscal 2010. Our U.S. federal tax returns for fiscal years 2010 through 2018 are currently under examination by the IRS. With respect to the fiscal years 2010 to 2014, the IRS has issued a proposed adjustment relating to transfer pricing between our entities in the U.S. and China. We are defending our position using all available remedies including bi-lateral relief from double taxation. There are also ongoing U.S. state and local audits and other foreign audits covering fiscal years 2008 through 2019. We do not expect the results from any ongoing income tax audit to have a material impact on our 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, as well as the expiration of statutes of limitations, could reduce our unrecognized tax benefits by an immaterial amount. We do not anticipate the resolution of these matters will result in a material change to our consolidated financial condition or results of operations. Unrecognized Tax Benefits Reconciliations of the beginning and ending amount of our gross unrecognized tax benefits follow:
in millions | Fiscal |  | Fiscal |  | Fiscal
2020 |  | 2019 |  | 2018
Unrecognized tax benefits balance at beginning of fiscal year | $ | 473 |  |  | $ | 494 |  |  | $ | 637 |
Additions based on tax positions related to the current year | 75 |  |  | 96 |  |  | 91 |
Additions for tax positions of prior years | 72 |  |  | 82 |  |  | 100 |
Reductions for tax positions of prior years | (53) |  |  | (147) |  |  | (245) |
Reductions due to settlements | (22) |  |  | (13) |  |  | (66) |
Reductions due to lapse of statute of limitations | (5) |  |  | (39) |  |  | (23) |
Unrecognized tax benefits balance at end of fiscal year | $ | 540 |  |  | $ | 473 |  |  | $ | 494 |
Unrecognized tax benefits that if recognized would affect our annual effective income tax rate on net earnings were $458 million, $407 million, and $398 million at January 31, 2021, February 2, 2020, and February 3, 2019, respectively. Interest and Penalties Net adjustments to accruals for interest and penalties associated with uncertain tax positions were immaterial in fiscal 2020, fiscal 2019 and fiscal 2018. Our total accrued interest and penalties follow:
in millions | January 31, 2021 |  | February 2, 2020
Total accrued interest and penalties | $ | 97 |  |  | $ | 87 |

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 + Details
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