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INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Income Tax Expense Benefit

The income tax expense (benefit) for the years ended December 31, 2020, 2019 and 2018 consists of the following (in millions):

			2020						2019						2018
Current:
U.S. Federal			$	839					$	570					$	89
U.S. State and Local			100						183						7
Non-U.S.			420						359						374
Total Current			1,359						1,112						470
Deferred:
U.S. Federal			(725)						255						668
U.S. State and Local			(159)						(93)						75
Non-U.S.			26						(62)						15
Total Deferred			(858)						100						758
Total Income Tax Expense			$	501					$	1,212					$	1,228

Income Before Income Taxes

Income before income taxes includes the following components (in millions):

			2020						2019						2018
United States			$	(39)					$	3,972					$	4,307
Non-U.S.			1,883						1,680						1,712
Total Income Before Income Taxes:			$	1,844					$	5,652					$	6,019

Reconciliation of Statutory Federal Income Tax Rate to Effective Income Tax Rate

A reconciliation of the statutory federal income tax rate to the effective income tax rate for the years ended December 31, 2020, 2019 and 2018 consists of the following:

			2020						2019						2018
Statutory U.S. federal income tax rate			21.0		%				21.0		%				21.0		%
U.S. state and local income taxes (net of federal benefit) (1)			(2.6)						1.4						1.4
Non-U.S. tax rate differential			1.6						0.3						0.2
U.S. federal tax credits			(3.6)						(1.4)						(1.1)
Goodwill and other asset impairments			5.1						—						—
Net uncertain tax positions			3.6						0.1						(0.6)
Non-U.S. valuation allowance release			—						(1.2)						—
Other			2.1						1.2						(0.5)
Effective income tax rate			27.2		%				21.4		%				20.4		%

Deferred Tax Liabilities and Assets

Deferred income tax assets and liabilities are comprised of the following as of December 31, 2020 and 2019 (in millions):

			2020						2019
Fixed assets and capitalized software			$	(5,355)					$	(4,720)
Operating lease right-of-use assets			(730)						(685)
Other			(501)						(538)
Deferred tax liabilities			(6,586)						(5,943)
Pension and postretirement benefits			3,994						2,522
Loss and credit carryforwards			325						328
Insurance reserves			535						413
Stock compensation			183						249
Accrued employee compensation			583						287
Operating lease liabilities			736						691
Other			357						205
Deferred tax assets			6,713						4,695
Deferred tax assets valuation allowance			(88)						(54)
Deferred tax asset (net of valuation allowance)			6,625						4,641
Net deferred tax asset (liability)			$	39					$	(1,302)
Amounts recognized in the consolidated balance sheets:
Deferred tax assets			$	527					$	330
Deferred tax liabilities			(488)						(1,632)
Net deferred tax asset (liability)			$	39					$	(1,302)

U.S. State and Local Operating Loss and Credit Carryforwards

Further, we have U.S. state and local operating loss and credit carryforwards as follows (in millions):

			2020						2019
U.S. state and local operating loss carryforwards			$	1,253					$	1,374
U.S. state and local credit carryforwards			$	108					$	110

Summarized Activity Related to Unrecognized Tax Benefits

The following table summarizes the activity related to our uncertain tax positions (in millions):

			Tax						Interest						Penalties
Balance at January 1, 2018			$	160					$	43					$	9
Additions for tax positions of the current year			47						—						1
Additions for tax positions of prior years			7						10						—
Reductions for tax positions of prior years for:
Changes based on facts and circumstances			(43)						(8)						(5)
Settlements during the period			(1)						(1)						—
Lapses of applicable statute of limitations			(3)						—						—
Balance as of December 31, 2018			167						44						5
Additions for tax positions of the current year			6						—						—
Additions for tax positions of prior years			51						13						—
Reductions for tax positions of prior years for:
Changes based on facts and circumstances			(45)						(4)						(1)
Settlements during the period			(3)						(1)						—
Lapses of applicable statute of limitations			(4)						—						—
Balance as of December 31, 2019			172						52						4
Additions for tax positions of the current year			61						—						—
Additions for tax positions of prior years			154						34						2
Reductions for tax positions of prior years for:
Changes based on facts and circumstances			(54)						(24)						(2)
Settlements during the period			—						(1)						—
Lapses of applicable statute of limitations			—						—						—
Balance as of December 31, 2020			$	333					$	61					$	4

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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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