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Income Taxes (Tables)

12 Months Ended

Mar. 31, 2023

Income Tax Disclosure [Abstract]

Schedule of income (loss) from continuing operations before income taxes

			Years Ended March 31,
(In millions)			2023						2022						2021
Income (loss) from continuing operations before income taxes
U.S.			$	3,308					$	1,944					$	(6,019)
Foreign			1,322						(16)						985
Income (loss) from continuing operations before income taxes			$	4,630					$	1,928					$	(5,034)

Schedule of income tax expense (benefit) related to continuing operations

Income tax expense (benefit) related to continuing operations consists of the following:

			Years Ended March 31,
(In millions, except percentages)			2023						2022						2021
Current
Federal			$	619					$	233					$	(15)
State			126						129						47
Foreign			180						240						181
Total current			925						602						213
Deferred
Federal			(46)						88						(562)
State			36						(16)						(204)
Foreign			(10)						(38)						(142)
Total deferred			(20)						34						(908)
Income tax expense (benefit)			$	905					$	636					$	(695)
Reported income tax rate			19.5		%				33.0		%				(13.8)		%

Schedule of reconciliation between effective tax rate on income from continuing operations and statutory tax rate

The reconciliation of income tax expense (benefit) and the amount computed by applying the statutory federal income tax rate of 21.0% to income before income taxes was as follows:

			Years Ended March 31,
(In millions)			2023						2022						2021
Income tax expense (benefit) at federal statutory rate			$	972					$	405					$	(1,057)
State income taxes, net of federal tax benefit			134						85						(206)
Tax effect of foreign operations			(145)						(186)						(77)
Unrecognized tax benefits and settlements			6						(26)						41
Opioid-related litigation and claims			9						38						715
Net tax benefit on intellectual property transfer			—						—						(105)
E.U. disposal transaction loss			(8)						345						—
Share-based compensation			(58)						(10)						1
Other, net (1)			(5)						(15)						(7)
Income tax expense (benefit)			$	905					$	636					$	(695)

(1)The Company’s effective tax rates were impacted by other favorable U.S. federal permanent differences, including research and development credits of $4 million in each of fiscal 2023 and fiscal 2022, and $5 million in fiscal 2021.

Schedule of deferred tax balances

Deferred tax balances consisted of the following:

			March 31,
(In millions)			2023						2022
Assets
Receivable allowances			$	51					$	49
Opioid-related litigation and claims			699						755
Compensation and benefit related accruals			265						285
Net operating loss and credit carryforwards			760						739
Lease obligations			427						422
Other			127						83
Subtotal			2,329						2,333
Less: valuation allowance			(696)						(726)
Total assets			1,633						1,607
Liabilities
Inventory valuation and other assets			(2,079)						(1,993)
Fixed assets and systems development costs			(32)						(184)
Intangibles			(267)						(233)
Lease right-of-use assets			(412)						(401)
Other			(19)						(17)
Total liabilities			(2,809)						(2,828)
Net deferred tax liability			$	(1,176)					$	(1,221)
Long-term deferred tax asset			$	211					$	197
Long-term deferred tax liability			(1,387)						(1,418)
Net deferred tax liability			$	(1,176)					$	(1,221)

Schedule of gross unrecognized tax benefits

The following table summarizes the activity related to the Company’s gross unrecognized tax benefits for the last three fiscal years:

			Years Ended March 31,
(In millions)			2023						2022						2021
Unrecognized tax benefits at beginning of period			$	1,523					$	1,754					$	958
Additions based on tax positions related to prior years			—						14						53
Reductions based on tax positions related to prior years			(26)						(131)						(5)
Additions based on tax positions related to current year			21						14						755
Reductions based on settlements			(96)						(20)						(8)
Reductions based on the lapse of the applicable statutes of limitations			(16)						(102)						(12)
Exchange rate fluctuations			(7)						(6)						13
Unrecognized tax benefits at end of period			$	1,399					$	1,523					$	1,754

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Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years.

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Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets.

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Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

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Tabular disclosure of income before income tax between domestic and foreign jurisdictions.

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Tabular disclosure for tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities and other income tax contingencies. Includes, but is not limited to, interest and penalties, reconciliation of unrecognized tax benefits, unrecognized tax benefits that would affect the effective tax rate, tax years that remain subject to examination by tax jurisdictions, and information about positions for which it is reasonably possible that amounts unrecognized will significantly change within 12 months.

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