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Income Taxes | 12 Months Ended
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Feb. 02, 2013
Income Taxes | Note K. Income Taxes The provision for income taxes includes the following:
|  | Fiscal Year Ended |
In thousands |  | February 2, 2013 |  |  | January 28, 2012 |  |  | January 29, 2011 |
|  | (53 weeks) |  |  |  |  |  |  |
Current: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 842,149 |  |  | $ | 554,847 |  |  | $ | 510,629 |
State |  |  | 162,200 |  |  |  | 126,237 |  |  |  | 113,573 |
Foreign |  |  | 153,083 |  |  |  | 99,463 |  |  |  | 105,489 |
Deferred: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | 22,394 |  |  |  | 131,527 |  |  |  | 91,568 |
State |  |  | 1,583 |  |  |  | 6,202 |  |  |  | 1,731 |
Foreign |  |  | (10,745 | ) |  |  | (2,952 | ) |  |  | 1,572 |
Provision for income taxes |  | $ | 1,170,664 |  |  | $ | 915,324 |  |  | $ | 824,562 |
Income from continuing operations before income taxes includes foreign pre-tax income of $559.7 million in fiscal 2013, $319.4 million in fiscal 2012 and $354.2 million in fiscal 2011. TJX had net deferred tax (liabilities) assets as follows:
|  | Fiscal Year Ended |
In thousands |  | February 2, 2013 |  |  | January 28, 2012 |
Deferred tax assets: |  |  |  |  |  |  |  |
Foreign tax credit carryforward |  | $ | — |  |  | $ | 24,861 |
Reserve for former operations |  |  | 19,565 |  |  |  | 7,363 |
Pension, stock compensation, postretirement and employee benefits |  |  | 313,597 |  |  |  | 265,397 |
Leases |  |  | 40,440 |  |  |  | 39,778 |
Computer Intrusion reserve |  |  | 5,661 |  |  |  | 5,699 |
Other |  |  | 64,393 |  |  |  | 65,970 |
Total deferred tax assets |  | $ | 443,656 |  |  | $ | 409,068 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Property, plant and equipment |  | $ | 360,282 |  |  | $ | 360,629 |
Capitalized inventory |  |  | 47,903 |  |  |  | 46,864 |
Tradename |  |  | 43,520 |  |  |  | 42,873 |
Undistributed foreign earnings |  |  | 233,002 |  |  |  | 201,012 |
Other |  |  | 12,216 |  |  |  | 14,322 |
Total deferred tax liabilities |  | $ | 696,923 |  |  | $ | 665,700 |
Net deferred tax (liability) |  | $ | (253,267 | ) |  | $ | (256,632 | )
The fiscal 2013 net deferred tax liability is presented on the balance sheet as a current asset of $96.2 million and a non-current liability of $349.5 million. The fiscal 2012 net deferred tax liability is presented on the balance sheet as a current asset of $105.9 million and a non-current liability of $362.5 million. TJX has provided for deferred U.S. taxes on all undistributed earnings from its Winners Canadian subsidiary, its Puerto Rico subsidiary and its subsidiaries in Italy, India, Hong Kong, and Australia through February 2, 2013. The net deferred tax liability summarized above includes deferred taxes relating to temporary differences at our foreign operations and amounted to a $5.2 million net liability as of February 2, 2013 and $17.0 million net liability as of January 28, 2012. No income taxes have been provided on the approximately $385.4 million of undistributed earnings of foreign subsidiaries as of February 2, 2013, because such earnings are considered to be indefinitely reinvested in the business. A determination of the amount of unrecognized deferred tax liability related to the undistributed earnings is not practicable because of the complexities associated with the hypothetical calculations. TJX established valuation allowances against certain deferred tax assets, primarily related to state tax net operating losses from non operational subsidiaries, which may not be realized in future years. The amount of the valuation allowances was $4.6 million as of February 2, 2013 and $5.9 million as of January 28, 2012. TJX’s worldwide effective income tax rate was 38.0% for fiscal 2013, 38.0% for fiscal 2012 and 38.1% for fiscal 2011. The difference between the U.S. federal statutory income tax rate and TJX’s worldwide effective income tax rate is reconciled below:
|  | Fiscal Year Ended |
|  | February 2, 2013 |  |  | January 28, 2012 |  |  | January 29, 2011 |
|  | (53 weeks) |  |  |  |  |  |  |
U.S. federal statutory income tax rate |  |  | 35.0 | % |  |  | 35.0 | % |  |  | 35.0 | %
Effective state income tax rate |  |  | 4.2 |  |  |  | 4.1 |  |  |  | 4.1 |
Impact of foreign operations |  |  | (0.9 | ) |  |  | (0.6 | ) |  |  | (0.5 | )
All Other |  |  | (0.3 | ) |  |  | (0.5 | ) |  |  | (0.5 | )
Worldwide effective income tax rate |  |  | 38.0 | % |  |  | 38.0 | % |  |  | 38.1 | %
TJX’s effective rate remained constant for fiscal 2013 as compared to fiscal 2012. The fiscal 2013 effective tax rate benefitted from an increase in foreign earnings, which are taxed at lower rates, but this benefit was offset by the absence of the benefit in fiscal 2012 due to a net reduction in federal and state tax reserves. The decrease in TJX’s effective rate for fiscal 2012 as compared to fiscal 2011 is primarily attributed to the favorable resolution of U.S. Federal tax audits partially offset by an increase in the U.S. federal and state tax reserves. TJX had net unrecognized tax benefits of $125.3 million as of February 2, 2013, $116.6 million as of January 28, 2012 and $122.9 million as of January 29, 2011. A reconciliation of the beginning and ending gross amount of unrecognized tax benefits is as follows:
|  | Fiscal Year Ended |
In thousands |  | February 2, 2013 |  |  | January 28, 2012 |  |  | January 29, 2011 |
Balance at beginning of year |  | $ | 144,505 |  |  | $ | 123,094 |  |  | $ | 191,741 |
Additions for uncertain tax positions taken in current year |  |  | 1,949 |  |  |  | 1,131 |  |  |  | 3,968 |
Additions for uncertain tax positions taken in prior years |  |  | 3,009 |  |  |  | 63,463 |  |  |  | 23,730 |
Reductions for uncertain tax positions taken in prior years |  |  | — |  |  |  | (40,558 | ) |  |  | (92,483 | )
Reductions resulting from lapse of statute of limitations |  |  | (129 | ) |  |  | — |  |  |  | (1,123 | )
Settlements with tax authorities |  |  | (557 | ) |  |  | (2,625 | ) |  |  | (2,739 | )
Balance at end of year |  | $ | 148,777 |  |  | $ | 144,505 |  |  | $ | 123,094 |
Included in the gross amount of unrecognized tax benefits are items that will not impact future effective tax rates upon recognition. These items amounted to $19.8 million as of February 2, 2013, $20.0 million as of January 28, 2012 and $11.0 million as of January 29, 2011. TJX is subject to U.S. federal income tax as well as income tax in multiple state, local and foreign jurisdictions. In nearly all jurisdictions, the tax years through fiscal 2001 are no longer subject to examination. TJX’s accounting policy is to classify interest and penalties related to income tax matters as part of income tax expense. The amount of interest and penalties expensed was $4.7 million for the year ended February 2, 2013; $5.8 million for the year ended January 28, 2012 and $1.9 million for the year ended January 29, 2011. The accrued amounts for interest and penalties are $38.6 million as of February 2, 2013, $33.0 million as of January 28, 2012 and $34.6 million as of January 29, 2011. Based on the final resolution of tax examinations, judicial or administrative proceedings, changes in facts or law, expirations of statute of limitations in specific jurisdictions or other resolutions of, or changes in, tax positions, it is reasonably possible that unrecognized tax benefits for certain tax positions taken on previously filed tax returns may change materially from those represented on the financial statements as of February 2, 2013. During the next twelve months, it is reasonably possible that such circumstances may occur that would have a material effect on previously unrecognized tax benefits. As a result, the total net amount of unrecognized tax benefits may decrease, which would reduce the provision for taxes on earnings by a range estimated at $1.0 million to $50 million.

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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/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 136, 172 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph h -Article 4 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 43, 44, 45, 46, 47, 48, 49 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32537-109319 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32559-109319 + Details
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