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Income Taxes | 9 Months Ended
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Sep. 30, 2018
Income Taxes [Abstract] |
Income Taxes | 5. Income Taxes ﻿ Our provision for income taxes and the related effective income tax rates are as follows (in millions): ﻿ ﻿
﻿ |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  | Three Months Ended |  | Nine Months Ended
﻿ |  | September 30, |  | September 30,
﻿ |  | 2018 |  | 2017 |  | 2018 |  | 2017
﻿ |  |  |  |  |  |  |  |  |  |  |  |
﻿Provision for income taxes |  | $ | (133) |  | $ | (89) |  | $ | (383) |  | $ | (176)
﻿Effective tax rate |  |  | 17.5% |  |  | 18.6% |  |  | 33.1% |  |  | 16.1%
﻿ For the three months ended September 30, 2018, the effective income tax rate differed from the U.S. statutory rate of 21% primarily due to the following: ﻿
| · |  | Additional tax amounts related to global intangible low-taxed income (“GILTI”);
| · |  | Benefits related to foreign derived intangible income (“FDII”);
| · |  | An increase in the estimated annual impact of the base erosion and anti-deferral tax (“BEAT”); and
| · |  | A $48 million benefit related to an adjustment to the provisional estimate of the one-time Toll Charge recorded in 2017.
﻿ For the nine months ended September 30, 2018, the effective income tax rate differed from the U.S. statutory rate of 21% primarily due to the following: ﻿
| · |  | Additional tax expense of $172 million related to a preliminary agreement with the Internal Revenue Service (“IRS”) to settle the income tax audit for the years 2013 and 2014;
| · |  | Additional tax amounts related to global intangible low-taxed income (“GILTI”);
| · |  | Benefits related to foreign derived intangible income (“FDII”);
| · |  | An increase in the estimated annual impact of the base erosion and anti-deferral tax (“BEAT”);
| · |  | A $28 million benefit from the release of a valuation allowance on deferred tax assets that are now considered realizable; and
| · |  | A $48 million benefit related to an adjustment to the provisional estimate of the one-time Toll Charge recorded in 2017.
﻿ For the three and nine months ended September 30, 2017, the effective income tax benefit differed from the U.S. statutory rate of 35% primarily due to the following benefits: ﻿
| · |  | Rate differences on income (loss) of consolidated foreign companies; and
| · |  | The benefit of excess foreign tax credits resulting from the inclusion of foreign earnings in U.S. income.
﻿ The Tax Cuts and Jobs Act (the “2017 Tax Act”) was enacted on December 22, 2017. The 2017 Tax Act reduced the U.S. federal corporate income tax rate from 35% to 21%, and requires companies to pay a one-time transition tax, (the “Toll Charge”), on earnings of certain foreign subsidiaries that were previously tax deferred and creates new taxes on certain foreign sourced earnings. We are applying the guidance in SAB 118 when accounting for the enactment-date effects of the Act. As of September 30, 2018, we have not completed our accounting for all of the tax effects of the 2017 Tax Act. We have made a reasonable estimate of certain effects of the 2017 Tax Act. However, in other cases, we have not been able to make a reasonable estimate and continue to account for those items based on our existing accounting under ASC 740, Income Taxes, and the provisions of the tax laws that were in effect immediately prior to enactment. In all cases, we will continue to make and refine our calculations as additional analysis is completed. Our estimates may also be affected as we gain a more thorough understanding of the 2017 Tax Act, including recently issued and anticipated proposed guidance, between now and December 31, 2018. These changes could be material to income tax expense. ﻿ At year end December 31, 2017, we remeasured certain deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%. We recorded a provisional amount of $347 million at that time. At December 31, 2017, we recorded a one-time Toll Charge based on our unrepatriated earnings of certain foreign subsidiaries that were previously deferred. This charge resulted in a provisional tax expense amount of $1.1 billion. At September 30, 2018, we have reduced our estimate of the one-time Toll Charge recorded in 2017 by $48 million in conjunction with filing our Federal income tax return. We will continue to analyze and refine our calculations related to the measurement of these balances. ﻿ As of September 30, 2018, Corning has not yet completed its analysis of tax reform on its assertion regarding its indefinitely reinvested foreign earnings; therefore, the Company will continue to follow its historic position while it continues to analyze this issue. While Corning is not changing its assertion at this time, the Company distributed approximately $2.2 billion during 2018 from its foreign subsidiaries to the U.S. parent of those subsidiaries. There are no incremental taxes beyond the Toll Charge recorded in 2017 due with respect to this distribution of cash. ﻿ Under new guidance, a company can make a policy election to account for tax on global intangible low-taxed income (“GILTI”) as a period cost only or to also recognize deferred tax assets and liabilities when basis differences exist that are expected to affect the amount of GILTI inclusion upon reversal. Corning’s accounting for the impact of the GILTI provisions of the 2017 Tax Act is incomplete and, as a result, it has not yet elected a policy to account for the GILTI provisions. ﻿ We will continue to monitor future guidance and to assess the impacts of the 2017 Tax Act. ﻿ Corning has reached a preliminary agreement with the IRS Exam team to resolve its 2013 and 2014 audits. This preliminary agreement resulted in $172 million of additional tax expense in the first quarter of 2018, of which $12 million relates to interest expense, net of tax benefit. Corning will use tax attributes to cover most of the tax expense. ﻿ Corning Display Technologies Taiwan (“CDTT”) is currently under audit by the Ministry of Finance for the 2015 tax year. We expect this audit to take up to 2 years to complete. ﻿ Corning Precision Materials (“CPM”) is involved in several income and withholding tax disputes with South Korea. The tax amounts in dispute are on deposit with the South Korean tax authorities and CPM has booked receivables for the amounts on deposit. Corning believes that its tax positions are appropriate and is vigorously defending such positions. ﻿ Under its historic policy, Corning will continue to indefinitely reinvest substantially all of its foreign earnings, with the exception of an immaterial amount of current earnings that have very low or no tax cost associated with their repatriation. Our current analysis indicates that we have sufficient U.S. liquidity, including borrowing capacity, to fund foreseeable U.S. cash needs without requiring the repatriation of foreign cash.

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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 Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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