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Income Taxes
 3 Months Ended
Mar. 28, 2026
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The provision for income taxes in the accompanying statements of income differs from the provision calculated by applying the statutory federal income tax rate to income before provision for income taxes due to the following:
Three months ended
(Dollars in millions)March 28, 2026March 29, 2025
U.S. federal statutory tax rate$364 21.0 %$340 21.0 %
State and local income taxes, net of federal income tax effect21 1.2 %14 0.8 %
Foreign tax effects(150)(8.7)%(43)(2.6)%
Effect of changes in tax laws or rates enacted in the current period— 0.0 %2 0.1 %
Effect of cross-border tax laws59 3.4 %19 1.2 %
Tax credits(46)(2.6)%(45)(2.8)%
Changes in valuation allowances— 0.0 %(28)(1.7)%
Nontaxable or nondeductible items— 0.0 %(8)(0.5)%
Changes in unrecognized tax benefits1 0.0 %(28)(1.7)%
Other adjustments(179)(10.3)%(128)(7.9)%
Effective tax rate$70 4.0 %$95 5.8 %
In the first three months of 2026 and 2025, the company recorded deferred tax benefits from the recognition of a tax attribute related to domestication transactions of $175 million and $125 million, respectively, included in Other adjustments above.
The company has operations and a taxable presence in approximately 70 countries outside the U.S. The company's effective income tax rate differs from the U.S. federal statutory rate each year due to certain operations that are subject to tax incentives, state and local taxes, and foreign taxes that are different than the U.S. federal statutory rate.
On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was enacted. The OBBBA includes a broad range of provisions, such as the permanent extension of certain otherwise expiring provisions, modifications to the international tax framework and the reinstatement of favorable tax treatment for certain business provisions. The OBBBA made changes to certain US corporate tax provisions which are effective beginning in 2026. The enactment of the OBBBA does not have a material impact on the results from operations for the current year or future years.
Unrecognized Tax Benefits
As of March 28, 2026, the company had $0.42 billion of unrecognized tax benefits substantially all of which, if recognized, would reduce the effective tax rate. A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows:
(In millions)2026
Balance at beginning of year
$419 
Additions for tax positions of current year
1 
Balance at end of period
$420