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Income Taxes (Notes)
 12 Months Ended
Dec. 31, 2023
Income Tax Examination [Line Items]  
Income Tax Disclosure [Text Block] Income Taxes
The current income tax provision reflects the tax consequences of revenues and expenses currently taxable or deductible on various income tax returns for the year reported. The deferred income tax provision or benefit generally reflects the net change in deferred income tax assets and liabilities during the year, excluding any deferred income tax assets and liabilities of acquired businesses.
The components of the provision for income taxes for the years ended December 31 are as follows:
(in millions)202320222021
Current Provision:  
Federal$4,418 $4,842 $3,451 
State and local716 855 481 
Foreign1,079 680 516 
Total current provision6,213 6,377 4,448 
Deferred (benefit) provision(245)(673)130 
Total provision for income taxes$5,968 $5,704 $4,578 
The reconciliation of the tax provision at the U.S. federal statutory rate to the provision for income taxes and the effective tax rate for the years ended December 31 is as follows:
(in millions, except percentages)202320222021
Tax provision at the U.S. federal statutory rate$6,114 21.0 %$5,532 21.0 %$4,685 21.0 %
State income taxes, net of federal benefit567 2.0 621 2.4 419 1.9 
Share-based awards - excess tax benefit(75)(0.3)(110)(0.4)(100)(0.4)
Non-deductible compensation174 0.6 150 0.6 144 0.6 
Foreign rate differential(442)(1.5)(265)(1.0)(246)(1.1)
Other, net(370)(1.3)(224)(0.9)(324)(1.5)
Provision for income taxes$5,968 20.5 %$5,704 21.7 %$4,578 20.5 %
Deferred income tax assets and liabilities are recognized for the differences between the financial and income tax reporting bases of assets and liabilities based on enacted tax rates and laws. The components of deferred income tax assets and liabilities as of December 31 are as follows:
(in millions)20232022
Deferred income tax assets:  
Accrued expenses and allowances$754 $707 
U.S. federal and state net operating loss carryforwards417 540 
Share-based compensation
173 154 
Nondeductible liabilities
329 341 
Non-U.S. tax loss carryforwards
1,061 631 
Lease liability
930 972 
  Net unrealized losses on investments586 829 
Other-domestic
327 291 
Other-non-U.S.
484 423 
Subtotal5,061 4,888 
Less: valuation allowances(366)(291)
Total deferred income tax assets4,695 4,597 
Deferred income tax liabilities:
U.S. federal and state intangible assets(3,712)(3,520)
Non-U.S. goodwill and intangible assets(731)(550)
Capitalized software
(415)(548)
Depreciation and amortization
(371)(520)
Prepaid expenses(326)(275)
Outside basis in partnerships
(811)(653)
Lease right-of-use asset
(914)(958)
Other-non-U.S.
(436)(342)
Total deferred income tax liabilities(7,716)(7,366)
Net deferred income tax liabilities$(3,021)$(2,769)
Valuation allowances are provided when it is considered more likely than not deferred tax assets will not be realized. The valuation allowances primarily relate to future tax benefits on certain federal, state and non-U.S. net operating loss carryforwards. Gross federal net operating loss carryforwards of $125 million expire beginning in 2026 through 2042 and $360 million have an indefinite carryforward period; state net operating loss carryforwards expire beginning in 2024 through 2043, with some having an indefinite carryforward period. Substantially all of the non-U.S. tax loss carryforwards have indefinite carryforward periods. Additionally, as of December 31, 2023, the Company has historical non-U.S. net operating loss carryforwards for which a deferred tax asset and valuation allowance of $4.5 billion are not established because realization of the loss carryforwards is remote.
As of December 31, 2023, the Company’s undistributed earnings from non-U.S. subsidiaries are intended to be indefinitely reinvested in non-U.S. operations, and therefore no U.S. deferred taxes have been recorded. Taxes payable on the remittance of such earnings would be minimal.
A reconciliation of the beginning and ending amount of unrecognized tax benefits as of December 31 is as follows:
(in millions)202320222021
Gross unrecognized tax benefits, beginning of period$3,081 $2,310 $1,829 
Gross increases:   
Current year tax positions
782 586 538 
Prior year tax positions
97 206 10 
Gross decreases:   
Prior year tax positions
(212)(21)(47)
Statute of limitations lapses and settlements(32)— (20)
Gross unrecognized tax benefits, end of period$3,716 $3,081 $2,310 
The Company believes it is reasonably possible its liability for unrecognized tax benefits will decrease in the next twelve months by $145 million as a result of audit settlements and the expiration of statutes of limitations.
The Company classifies net interest and penalties associated with uncertain income tax positions as income taxes within its Consolidated Statements of Operations. During the years ended December 31, 2023, 2022 and 2021, the Company recognized $177 million, $64 million and $66 million of net interest and penalties, respectively. The Company had $430 million and $253 million of accrued interest and penalties for uncertain tax positions as of December 31, 2023 and 2022, respectively. These amounts are not included in the reconciliation above. As of December 31, 2023, there were $2.0 billion of unrecognized tax benefits which, if recognized, would affect the effective tax rate.
The Company currently files income tax returns in the United States, various states and localities and non-U.S. jurisdictions. The U.S. Internal Revenue Service (IRS) has completed exams on the consolidated income tax returns for fiscal years 2016 and prior. The Company’s 2017 through 2020 tax years are under review by the IRS under its Compliance Assurance Program. The Company is no longer subject to state income tax examinations prior to the 2014 tax year. In general, the Company is subject to examination in non-U.S. jurisdictions for years 2015 and forward.