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Income Taxes (Tables) | 12 Months Ended
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Dec. 31, 2022
Income Tax Disclosure [Abstract] |
Schedule of taxes on income | For financial reporting purposes, income before income taxes includes the following components:
For the Years Ended December 31,
(In millions) | 2022 |  | 2021 |  | 2020
Income before income taxes: |  |  |  |  |
U.S. | $ | 1,468 |  |  | $ | 1,590 |  |  | $ | 1,075 |
Other | 2,614 |  |  | 2,618 |  |  | 1,718 |
| $ | 4,082 |  |  | $ | 4,208 |  |  | $ | 2,793 |
The expense (benefit) for income taxes is comprised of: |  |  |  |
Current – |  |  |  |  |
U.S. Federal | $ | 262 |  |  | $ | 251 |  |  | $ | 172 |
Other national governments | 653 |  |  | 714 |  |  | 456 |
U.S. state and local | 123 |  |  | 132 |  |  | 79 |
| 1,038 |  |  | 1,097 |  |  | 707 |
Deferred – |  |  |  |  |
U.S. Federal | 38 |  |  | (40) |  |  | 40 |
Other national governments | (91) |  |  | (12) |  |  | (14) |
U.S. state and local | 10 |  |  | (11) |  |  | 14 |
| (43) |  |  | (63) |  |  | 40 |
Total income taxes | $ | 995 |  |  | $ | 1,034 |  |  | $ | 747 |
Schedule of deferred income tax assets and liabilities | The significant components of deferred income tax assets and liabilities and their balance sheet classifications are as follows:
December 31,
(In millions) | 2022 |  | 2021
Deferred tax assets: |  |  |
Accrued expenses not currently deductible (a) | $ | 670 |  |  | $ | 647 |
Differences related to non-U.S. operations (b) | 275 |  |  | 293 |
Accrued U.S. retirement benefits | 172 |  |  | 293 |
Net operating losses (c) | 285 |  |  | 183 |
Income currently recognized for tax | 34 |  |  | 29 |
Other | 25 |  |  | 32 |
| $ | 1,461 |  |  | $ | 1,477 |
Deferred tax liabilities: |  |  |
Differences related to non-U.S. operations | $ | 543 |  |  | $ | 624 |
Depreciation and amortization | 510 |  |  | 506 |
Accrued retirement & postretirement benefits - non-U.S. operations | 408 |  |  | 403 |
Capitalized expenses currently recognized for tax | 107 |  |  | 98 |
Other | 57 |  |  | 32 |
| $ | 1,625 |  |  | $ | 1,663 |
(a) Net of valuation allowances of $5 million in 2022 and $2 million in 2021. (b) Net of valuation allowances of $160 million in 2022 and $144 million in 2021. (c) Net of valuation allowances of $69 million in 2022 and $88 million in 2021.
December 31,
(In millions) | 2022 |  | 2021
Balance sheet classifications: |  |  |
Deferred tax assets | $ | 358 |  |  | $ | 551 |
Other liabilities | $ | 522 |  |  | $ | 737 |
Schedule of u.s. federal statutory income tax rate | A reconciliation from the U.S. federal statutory income tax rate to the Company’s effective income tax rate is shown below:
For the Years Ended December 31, | 2022 |  | 2021 |  | 2020
U.S. Federal statutory rate | 21.0 | % |  | 21.0 | % |  | 21.0 | %
U.S. state and local income taxes—net of U.S. Federal income tax benefit | 2.7 |  |  | 2.3 |  |  | 2.5 |
Differences related to non-U.S. operations | 0.7 |  |  | 0.1 |  |  | 2.3 |
U.K. statutory rate change | — |  |  | 2.6 |  |  | — |
Gain on consolidation of business | — |  |  | (1.5) |  |  | — |
Equity compensation | (0.7) |  |  | (0.7) |  |  | (1.4) |
Uncertain tax positions | 0.1 |  |  | 0.1 |  |  | 1.1 |
Other | 0.6 |  |  | 0.7 |  |  | 1.2 |
Effective tax rate | 24.4 | % |  | 24.6 | % |  | 26.7 | %
Schedule of unrecognized tax benefits | Following is a reconciliation of the Company’s total gross unrecognized tax benefits for the years ended December 31, 2022, 2021 and 2020:
(In millions) | 2022 |  | 2021 |  | 2020
Balance at January 1, | $ | 94 |  |  | $ | 98 |  |  | $ | 86 |
Additions, based on tax positions related to current year | 1 |  |  | 2 |  |  | 9 |
Additions for tax positions of prior years | 15 |  |  | 11 |  |  | 25 |
Reductions for tax positions of prior years | (2) |  |  | (1) |  |  | (9) |
Settlements | (2) |  |  | (1) |  |  | (4) |
Lapses in statutes of limitations | (9) |  |  | (15) |  |  | (9) |
Balance at December 31, | $ | 97 |  |  | $ | 94 |  |  | $ | 98 |
Schedule of status of audits for significant jurisdictions outside of the united states | The status of audits for significant jurisdictions outside the U.S. are summarized in the table below:
Tax Audit (Years) |  |  |  |  |  |
Jurisdiction: | Initiated in 2022 |  | Ongoing |  | Concluded |
France |  |  |  |  | 2017, 2018 during 2022 |
Germany |  |  | 2013-2016 |  | 2017-2018 during 2022 |
Hong Kong |  |  |  |  | 2019 during 2022 |
Italy |  |  | 2015-2016 |  | 2017 during 2022 |
Singapore | 2018-2021 |  | 2017-2021 |  | 2018-2020 during 2022 |
United Kingdom | 2020 |  | 2016-2020 |  |  |

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- Definition Tabular disclosure of income tax examinations that an enterprise is currently subject to or that have been completed in the current period typically including a description of the examination, the jurisdiction conducting the examination, the tax year(s) under examination, the likelihood of an unfavorable settlement, the range of possible losses, the liability recorded, the increase or decrease in the liability from the prior period, and any penalties and interest that have been recorded. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32718-109319 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 55 -Paragraph 217 -URI https://asc.fasb.org/extlink&oid=126976462&loc=d3e36027-109320 + Details
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