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Income Taxes | 12 Months Ended
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Dec. 31, 2017
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes
| Years Ended December 31,
| 2017 |  | 2016 |  | 2015
U.S. income | $ | 8,399 |  |  | $ | 9,989 |  |  | $ | 6,994 |
Non-U.S. income (loss) | 1,332 |  |  | (263 | ) |  | (816 | )
Income before income taxes and equity income | $ | 9,731 |  |  | $ | 9,726 |  |  | $ | 6,178 |
| Years Ended December 31,
| 2017 |  | 2016 |  | 2015
Current income tax expense (benefit) |  |  |  |  |
U.S. federal | $ | 18 |  |  | $ | (126 | ) |  | $ | 5 |
U.S. state and local | 83 |  |  | 65 |  |  | 5 |
Non-U.S. | 552 |  |  | 572 |  |  | 817 |
Total current income tax expense | 653 |  |  | 511 |  |  | 827 |
Deferred income tax expense (benefit) |  |  |  |  |  |  |  |
U.S. federal | 7,831 |  |  | 1,865 |  |  | 1,735 |
U.S. state and local | (187 | ) |  | 264 |  |  | 243 |
Non-U.S. | 3,236 |  |  | 99 |  |  | (4,024 | )
Total deferred income tax expense (benefit) | 10,880 |  |  | 2,228 |  |  | (2,046 | )
Total income tax expense (benefit) | $ | 11,533 |  |  | $ | 2,739 |  |  | $ | (1,219 | )
Provisions are made for estimated U.S. and non-U.S. income taxes which may be incurred on the reversal of our basis differences in investments in foreign subsidiaries and corporate joint ventures not deemed to be indefinitely reinvested. Taxes have not been provided on basis differences in investments primarily as a result of earnings in foreign subsidiaries which are deemed indefinitely reinvested of $2.8 billion and $2.4 billion at December 31, 2017 and 2016. Additional basis differences related to investments in nonconsolidated China JVs exist of $4.1 billion at December 31, 2017 and 2016 as a result of fresh-start reporting. Quantification of the deferred tax liability, if any, associated with indefinitely reinvested basis differences is not practicable. The non-U.S. deferred income tax benefit in the year ended December 31, 2015 relates primarily to the release of valuation allowances in Europe.
| Years Ended December 31,
| 2017 |  | 2016 |  | 2015
Income tax expense at U.S. federal statutory income tax rate | $ | 3,406 |  |  | $ | 3,404 |  |  | $ | 2,162 |
State and local tax expense | (76 | ) |  | 190 |  |  | 173 |
Non-U.S. income taxed at other than 35% | (145 | ) |  | (61 | ) |  | 37 |
U.S. tax on Non-U.S. income | (941 | ) |  | (894 | ) |  | (151 | )
Change in valuation allowances | 2,712 |  |  | 237 |  |  | (3,554 | )
Change in tax laws | 7,194 |  |  | 147 |  |  | 29 |
Research and manufacturing incentives | (313 | ) |  | (266 | ) |  | (367 | )
Settlements of prior year tax matters | (256 | ) |  | (46 | ) |  | — |
Realization of basis differences in affiliates | — |  |  | (94 | ) |  | — |
Foreign currency remeasurement | 23 |  |  | (2 | ) |  | 209 |
Financial penalty under the DPA(a) | — |  |  | — |  |  | 315 |
Other adjustments | (71 | ) |  | 124 |  |  | (72 | )
Total income tax expense (benefit) | $ | 11,533 |  |  | $ | 2,739 |  |  | $ | (1,219 | )
_________
(a) | Refer to Note 17 for additional information on the DPA.
Deferred Income Tax Assets and Liabilities Deferred income tax assets and liabilities at December 31, 2017 and 2016 reflect the effect of temporary differences between amounts of assets, liabilities and equity for financial reporting purposes and the bases of such assets, liabilities and equity as measured based on tax laws, as well as tax loss and tax credit carryforwards. The following table summarizes the components of temporary differences and carryforwards that give rise to deferred tax assets and liabilities:
| December 31, 2017 |  | December 31, 2016
Deferred tax assets |  |  |
Postretirement benefits other than pensions | $ | 1,948 |  |  | $ | 2,720 |
Pension and other employee benefit plans | 3,285 |  |  | 5,141 |
Warranties, dealer and customer allowances, claims and discounts | 5,675 |  |  | 8,074 |
Property, plant and equipment | — |  |  | 397 |
U.S. capitalized research expenditures | 4,413 |  |  | 6,127 |
U.S. operating loss and tax credit carryforwards(a) | 8,578 |  |  | 8,987 |
Non-U.S. operating loss and tax credit carryforwards(b) | 5,103 |  |  | 4,406 |
Miscellaneous | 1,697 |  |  | 1,733 |
Total deferred tax assets before valuation allowances | 30,699 |  |  | 37,585 |
Less: valuation allowances | (6,690 | ) |  | (3,908 | )
Total deferred tax assets | 24,009 |  |  | 33,677 |
Deferred tax liabilities |  |  |  |  |
Property, plant and equipment | 418 |  |  | — |
Intangible assets | 735 |  |  | 1,027 |
Total deferred tax liabilities | 1,153 |  |  | 1,027 |
Net deferred tax assets | $ | 22,856 |  |  | $ | 32,650 |
_________
(a) | At December 31, 2017 U.S. operating loss and tax credit carryforwards of $8.6 billion expire by 2037 if not utilized.
(b) | At December 31, 2017 Non-U.S. operating loss and tax credit carryforwards of $925 million expire by 2037 if not utilized and the remaining balance of $4.2 billion may be carried forward indefinitely.
Valuation Allowances During the year ended December 31, 2017 there was a $2.3 billion increase in the valuation allowance related to deferred tax assets that will no longer be realizable as a result of the sale of the Opel/Vauxhall Business as described in Note 3. At December 31, 2017 valuation allowances against deferred tax assets of $6.7 billion were comprised of cumulative losses and tax credits, primarily in Germany, Spain and South Korea. At December 31, 2016 valuation allowances against deferred tax assets of $3.9 billion were comprised of cumulative losses and tax credits, primarily in Spain, South Korea and certain U.S. states. Uncertain Tax Positions The following table summarizes activity of the total amounts of unrecognized tax benefits:
| Years Ended December 31,
| 2017 |  | 2016 |  | 2015
Beginning balance | $ | 1,182 |  |  | $ | 1,337 |  |  | $ | 1,705 |
Additions to current year tax positions | 160 |  |  | 49 |  |  | 53 |
Additions to prior years' tax positions | 448 |  |  | 96 |  |  | 114 |
Reductions to prior years' tax positions | (195 | ) |  | (192 | ) |  | (349 | )
Reductions in tax positions due to lapse of statutory limitations | (44 | ) |  | (103 | ) |  | (119 | )
Settlements | (11 | ) |  | (1 | ) |  | (3 | )
Other | 17 |  |  | (4 | ) |  | (64 | )
Ending balance | $ | 1,557 |  |  | $ | 1,182 |  |  | $ | 1,337 |
At December 31, 2017 and 2016 there were $390 million and $682 million of unrecognized tax benefits that if recognized would favorably affect our effective tax rate in the future. In the years ended December 31, 2017, 2016 and 2015 income tax related interest and penalties were insignificant. At December 31, 2017 and 2016 we had liabilities of $152 million and $160 million for income tax related interest and penalties. At December 31, 2017 it is not possible to reasonably estimate the expected change to the total amount of unrecognized tax benefits in the next twelve months. Other Matters Income tax returns are filed in multiple jurisdictions and are subject to examination by taxing authorities throughout the world. We have open tax years from 2007 to 2017 with various significant tax jurisdictions. Tax authorities may have the ability to review and adjust net operating loss or tax credit carryforwards that were generated prior to these periods if utilized in an open tax year. These open years contain matters that could be subject to differing interpretations of applicable tax laws and regulations as they relate to the amount, character, timing or inclusion of revenue and expenses or the sustainability of income tax credits for a given audit cycle. Given the global nature of our operations there is a risk that transfer pricing disputes may arise. The Tax Cuts and Jobs Act (the Tax Act) was signed into law on December 22, 2017. The Tax Act changed many aspects of U.S. corporate income taxation and included reduction of the corporate income tax rate from 35% to 21%, implementation of a territorial tax system and imposition of a tax on deemed repatriated earnings of foreign subsidiaries. We recognized the tax effects of the Tax Act in the year ended December 31, 2017 and recorded $7.3 billion in tax expense which relates almost entirely to the remeasurement of deferred tax assets to the 21% tax rate. Upon completion of our 2017 U.S. income tax return in 2018 we may identify additional remeasurement adjustments to our recorded deferred tax assets. We will continue to assess our provision for income taxes as future guidance is issued but do not currently anticipate significant revisions will be necessary. Any such revisions will be treated in accordance with the measurement period guidance outlined in Staff Accounting Bulletin No. 118.

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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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