XML 46 R27.htm IDEA: XBRL DOCUMENT
v3.22.4

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2022
Income Tax Disclosure [Abstract] |
Income Taxes | Income TaxesSubstantially all of the Company’s pre-tax earnings are derived from domestic operations in all years presented. The income tax provision was as follows for the years ended December 31:
(In millions) | 2022 |  | 2021 |  | 2020
Components of income tax provision (benefit): |  |  |  |  |
Current: |  |  |  |  |
Federal | $ | 802 |  |  | $ | 378 |  |  | $ | (25) |
State | 175 |  |  | 138 |  |  | 71 |
Foreign | 132 |  |  | 109 |  |  | 79 |
| 1,109 |  |  | 625 |  |  | 125 |
Deferred: |  |  |  |  |
Federal | (339) |  |  | (186) |  |  | 189 |
State | (84) |  |  | (106) |  |  | (34) |
Foreign | (135) |  |  | 30 |  |  | (84) |
| (558) |  |  | (262) |  |  | 71 |
Income tax provision | $ | 551 |  |  | $ | 363 |  |  | $ | 196 |
A reconciliation of the statutory federal income tax rate to the Company’s effective income tax rate is as follows for the years ended December 31:
| 2022 |  | 2021 |  | 2020
Statutory federal income tax rate | 21.0 | % |  | 21.0 | % |  | 21.0 | %
State income taxes, net of federal effect | 2.5 | % |  | 1.6 | % |  | 2.0 | %
Foreign tax law changes | — | % |  | 8.0 | % |  | 2.8 | %
Foreign derived intangibles income deduction | (0.9) | % |  | (3.1) | % |  | (3.2) | %
Excess tax benefit from share-based awards | (0.8) | % |  | (2.2) | % |  | (3.9) | %
Sale of businesses and subsidiary restructuring | (2.2) | % |  | (2.1) | % |  | 0.7 | %
Unrecognized tax benefits | (0.5) | % |  | (2.7) | % |  | (1.0) | %
Nondeductible executive compensation | 0.4 | % |  | 0.7 | % |  | 2.0 | %
Valuation allowance | (0.5) | % |  | (1.3) | % |  | (1.7) | %
Other, net | (0.1) | % |  | 1.9 | % |  | (2.0) | %
Effective income tax rate | 18.9 | % |  | 21.8 | % |  | 16.7 | %
Foreign tax law changes included $134 million and $32 million of income tax expense attributed to the revaluation of certain net deferred tax liabilities in connection with enacted corporate income tax rate changes in foreign countries during the years ended December 31, 2021 and 2020, respectively. In 2021, the enacted tax rate in the United Kingdom increased from 19% to 25% starting in 2023, and the tax rate in Argentina increased from 25% to 35%. In 2020, the tax rate in the United Kingdom increased from 17% to 19%. Significant components of deferred tax assets and liabilities consisted of the following at December 31:
(In millions) | 2022 |  | 2021
Accrued expenses | $ | 170 |  |  | $ | 171 |
Share-based compensation | 116 |  |  | 134 |
Net operating loss and credit carry-forwards | 805 |  |  | 804 |
Leasing liabilities | 170 |  |  | 194 |
Other | 163 |  |  | 194 |
Subtotal | 1,424 |  |  | 1,497 |
Valuation allowance | (620) |  |  | (697) |
Total deferred tax assets | 804 |  |  | 800 |
Capitalized software development costs | (481) |  |  | (633) |
Intangible assets | (2,319) |  |  | (2,676) |
Property and equipment | (308) |  |  | (280) |
Capitalized commissions | (106) |  |  | (95) |
Investments in joint ventures | (597) |  |  | (630) |
Leasing right-of-use assets | (134) |  |  | (142) |
Other | (405) |  |  | (474) |
Total deferred tax liabilities | (4,350) |  |  | (4,930) |
Total | $ | (3,546) |  |  | $ | (4,130) |
The Company maintained a valuation allowance of $620 million and $697 million at December 31, 2022 and 2021, respectively, against its deferred tax assets. Substantially all of the valuation allowance relates to certain foreign and state net operating loss carryforwards. Deferred tax assets and liabilities are reported in the consolidated balance sheets as follows at December 31:
(In millions) | 2022 |  | 2021
Noncurrent assets | $ | 56 |  |  | $ | 42 |
Noncurrent liabilities | (3,602) |  |  | (4,172) |
Total | $ | (3,546) |  |  | $ | (4,130) |
Noncurrent deferred tax assets are included in other long-term assets in the consolidated balance sheets at December 31, 2022 and 2021. The following table presents the amounts of federal, state and foreign net operating loss carryforwards and general business credit carryforwards at December 31:
(In millions) | 2022 |  | 2021
Net operating loss carryforwards: (1) |  |  |
Federal | $ | 214 |  |  | $ | 178 |
State | 2,810 |  |  | 3,763 |
Foreign | 2,373 |  |  | 2,580 |
General business credit carryforwards (2) | 17 |  |  | 12 |
(1)At December 31, 2022, the Company had federal net operating loss carryforwards of $214 million, most of which do not expire, state net operating loss carryforwards of $2.8 billion, most of which expire in 2023 through 2042, and foreign net operating loss carryforwards of $2.4 billion, of which $276 million expire in 2023 through 2041, and the remainder of which do not expire. (2)Substantially all of the general business credit carryforwards relate to foreign tax credits. The Company asserts that its investment in its foreign subsidiaries is intended to be indefinitely reinvested. Undistributed historical and future earnings of its foreign subsidiaries are not considered to be indefinitely reinvested. Should these earnings be distributed in the future in the form of dividends or otherwise, the Company may be subject to foreign or U.S. taxes. The Company has the ability and intent to limit distributions so as to not make a distribution in excess of its investment in those subsidiaries. The Company will continue to monitor its global cash requirements and the need to recognize a deferred tax liability. Unrecognized tax benefits were as follows at December 31:
(In millions) | 2022 |  | 2021 |  | 2020
Unrecognized tax benefits - Beginning of year | $ | 124 |  |  | $ | 171 |  |  | $ | 145 |
Increases for tax positions taken during the current year | 3 |  |  | 16 |  |  | 9 |
Increases for tax positions taken in prior years | — |  |  | 5 |  |  | 53 |
Decreases for tax positions taken in prior years | (18) |  |  | (41) |  |  | (23) |
Decreases for settlements | (2) |  |  | (1) |  |  | (2) |
Lapse of the statute of limitations | (11) |  |  | (26) |  |  | (11) |
Unrecognized tax benefits - End of year | $ | 96 |  |  | $ | 124 |  |  | $ | 171 |
At December 31, 2022, unrecognized tax benefits of $58 million, net of federal and state benefits, would affect the effective income tax rate if recognized. The Company believes it is reasonably possible that the liability for unrecognized tax benefits may decrease by up to $10 million over the next twelve months as a result of possible closure of federal tax audits, potential settlements with certain states and foreign countries, and the lapse of the statute of limitations in various state and foreign jurisdictions. The Company classifies interest expense and penalties related to income taxes as components of its income tax provision. The income tax provision included interest expense (benefits) and penalties on unrecognized tax benefits of less than $1 million in 2022, $(6) million in 2021 and $3 million in 2020. Accrued interest expense and penalties related to unrecognized tax benefits totaled $13 million and $15 million at December 31, 2022 and 2021, respectively. The Company’s U.S. federal income tax returns for 2021 and 2022, and tax returns in certain states and foreign jurisdictions for 2015 through 2022, remain subject to examination by taxing authorities.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI https://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI https://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration