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Income Taxes (Notes) | 12 Months Ended
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Dec. 31, 2021
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The principal components of EOG's total net deferred income tax liabilities at December 31, 2021 and 2020 were as follows (in millions):
| 2021 |  | 2020
Deferred Income Tax Assets (Liabilities) |  |  |
Foreign Oil and Gas Exploration and Development Costs Deducted for Tax Under Book Depreciation, Depletion and Amortization | $ | (19) |  |  | $ | 25 |
Foreign Asset Retirement Obligations | 51 |  |  | — |
Foreign Accrued Expenses and Liabilities | 15 |  |  | — |
Foreign Net Operating Loss | 80 |  |  | 74 |
Foreign Valuation Allowances | (111) |  |  | (97) |
Foreign Other | (5) |  |  | — |
Total Net Deferred Income Tax Assets | $ | 11 |  |  | $ | 2 |
Deferred Income Tax (Assets) Liabilities |  |  |
Oil and Gas Exploration and Development Costs Deducted for Tax Over Book Depreciation, Depletion and Amortization | $ | 5,063 |  |  | $ | 5,028 |
Commodity Hedging Contracts | (97) |  |  | 15 |
Deferred Compensation Plans | (57) |  |  | (43) |
Equity Awards | (86) |  |  | (103) |
Undistributed Foreign Earnings | — |  |  | 10 |
Other | (74) |  |  | (48) |
Total Net Deferred Income Tax Liabilities | $ | 4,749 |  |  | $ | 4,859 |
Total Net Deferred Income Tax Liabilities | $ | 4,738 |  |  | $ | 4,857 |
The components of Income (Loss) Before Income Taxes for the years indicated below were as follows (in millions):
| 2021 |  | 2020 |  | 2019
United States | $ | 5,787 |  |  | $ | (756) |  |  | $ | 3,466 |
Foreign | 146 |  |  | 17 |  |  | 79 |
Total | $ | 5,933 |  |  | $ | (739) |  |  | $ | 3,545 |
The principal components of EOG's Income Tax Provision (Benefit) for the years indicated below were as follows (in millions):
| 2021 |  | 2020 |  | 2019
Current: |  |  |  |  |
Federal | $ | 1,203 |  |  | $ | (108) |  |  | $ | (152) |
State | 85 |  |  | 7 |  |  | 10 |
Foreign | 105 |  |  | 40 |  |  | 81 |
Total | 1,393 |  |  | (61) |  |  | (61) |
Deferred: |  |  |  |  |
Federal | (41) |  |  | (153) |  |  | 627 |
State | (62) |  |  | (15) |  |  | 33 |
Foreign | (19) |  |  | (18) |  |  | (28) |
Total | (122) |  |  | (186) |  |  | 632 |
Other Non-Current: (1) |  |  |  |  |
Federal | — |  |  | 113 |  |  | 245 |
Foreign | (2) |  |  | — |  |  | (6) |
Total | (2) |  |  | 113 |  |  | 239 |
Income Tax Provision (Benefit) | $ | 1,269 |  |  | $ | (134) |  |  | $ | 810 |
(1) Includes changes in certain amounts that are expected to be paid or received beyond the next twelve months. The primary component in 2020 and 2019 is refundable alternative minimum tax (AMT) credits. The differences between taxes computed at the U.S. federal statutory tax rate and EOG's effective rate for the years indicated below were as follows:
| 2021 |  | 2020 |  | 2019
Statutory Federal Income Tax Rate | 21.0 | % |  | 21.0 | % |  | 21.0 | %
State Income Tax, Net of Federal Benefit | 0.3 |  |  | 0.9 |  |  | 1.0 |
Income Tax Provision Related to Foreign Operations | 0.9 |  |  | (0.1) |  |  | 0.9 |
Income Tax Provision Related to Canadian Operations | — |  |  | (2.4) |  |  | — |
Stock-Based Compensation | 0.2 |  |  | (2.9) |  |  | — |
Other | (1.0) |  |  | 1.7 |  |  | — |
Effective Income Tax Rate | 21.4 | % |  | 18.2 | % |  | 22.9 | %
The net effective tax rate of 21% in 2021 was higher than the prior year rate of 18% mostly due to taxes attributable to EOG's foreign operations and stock-based compensation tax deficiencies increasing the effective tax rate on pretax income in 2021 and decreasing the effective tax rate on pretax loss in 2020. Deferred tax assets are recorded for future deductible amounts and certain other tax benefits, such as tax NOLs and tax credit carryforwards, provided that management assesses the utilization of such assets to be "more likely than not." Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. On the basis of this evaluation, EOG has recorded valuation allowances for the portion of certain foreign and state deferred tax assets that management does not believe are more likely than not to be realized. The principal components of EOG's rollforward of valuation allowances for deferred income tax assets for the years indicated below were as follows (in millions):
| 2021 |  | 2020 |  | 2019
Beginning Balance | $ | 219 |  |  | $ | 201 |  |  | $ | 167 |
Increase (1) | 15 |  |  | 25 |  |  | 31 |
Decrease (2) | (14) |  |  | (11) |  |  | — |
Other (3) | (1) |  |  | 4 |  |  | 3 |
Ending Balance | $ | 219 |  |  | $ | 219 |  |  | $ | 201 |
(1) Increase in valuation allowance related to the generation of tax NOLs and other deferred tax assets. (2) Decrease in valuation allowance associated with adjustments to certain deferred tax assets and their related allowances. (3) Represents dispositions, revisions and/or foreign exchange rate variances and the effect of statutory income tax rate changes. As of December 31, 2021, EOG had state income tax NOLs of approximately $2 billion. Certain state NOLs have an indefinite carryforward and all others expire between 2022 and 2040. EOG also has Canadian NOLs of $297 million, some of which can be carried forward up to 20 years. As described previously, these NOLs and other less significant tax benefits have been evaluated for the likelihood of utilization, and valuation allowances have been established for the portion of these deferred income tax assets that do not meet the “more likely than not” threshold. The total balance of unrecognized tax benefits for all jurisdictions at December 31, 2021, was $9 million, resulting from the tax treatment of certain compensation deductions, of which the full amount may potentially have an earnings impact. EOG records interest and penalties related to unrecognized tax benefits to its income tax provision. No interest expense has been recognized in the Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) related to the unrecognized tax benefits as these positions are immaterial or will be claimed either on amended returns or as self-proposed audit adjustments, which if sustained, will result in refunds. EOG anticipates that the amount of the unrecognized tax benefits may change due to favorable audit developments expected to occur during the next twelve months. EOG and its subsidiaries file income tax returns and are subject to tax audits in the U.S. and various state, local and foreign jurisdictions. EOG's earliest open tax years in its principal jurisdictions are as follows: U.S. federal (2019), Canada (2017), Trinidad (2014) and Oman (2020). EOG's foreign subsidiaries' undistributed earnings are not considered to be permanently reinvested outside of the U.S. and deferred income taxes have been accrued on any such outside basis differences. Additionally, EOG’s foreign earnings may be subject to the U.S. federal "global intangible low-taxed income" (GILTI) inclusion. EOG records any GILTI tax as a period expense.

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