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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2016

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense

Income taxes charged to income were:

	Millions of Dollars
	2016				2015			2014
Income Taxes
Federal
Current	$	(105	)		1,128			1,661
Deferred	645				444			(378	)
Foreign
Current	66				(74	)		22
Deferred	(84		)		42			80
State and local
Current	(24		)		227			274
Deferred	49				(3	)		(5	)
	$	547			1,764			1,654

Schedule of Deferred Tax Assets and Liabilities

Major components of deferred tax liabilities and assets at December 31 were:

	Millions of Dollars
	2016				2015
Deferred Tax Liabilities
Properties, plants and equipment, and intangibles	$	4,525			4,361
Investment in joint ventures	2,442				2,292
Investment in subsidiaries	803				236
Inventory	154				176
Other	19				24
Total deferred tax liabilities	7,943				7,089
Deferred Tax Assets
Benefit plan accruals	669				751
Asset retirement obligations and accrued environmental costs	211				215
Other financial accruals and deferrals	188				175
Loss and credit carryforwards	261				227
Other	1				1
Total deferred tax assets	1,330				1,369
Less: valuation allowance	38				160
Net deferred tax assets	1,292				1,209
Net deferred tax liabilities	$	6,651			5,880

Schedule of Unrecognized Tax Benefits Roll Forward

As a result of the Separation and pursuant to the Tax Sharing Agreement with ConocoPhillips, the unrecognized tax benefits related to our operations for which ConocoPhillips was the taxpayer remain the responsibility of ConocoPhillips, and we have indemnified ConocoPhillips for such amounts. Those unrecognized tax benefits are included in the following table which shows a reconciliation of the beginning and ending unrecognized tax benefits.

	Millions of Dollars
	2016				2015			2014
Balance at January 1	$	82			142			202
Additions based on tax positions related to the current year	—				—			13
Additions for tax positions of prior years	5				6			14
Reductions for tax positions of prior years	(17		)		(17	)		(68	)
Settlements	—				(49	)		(19	)
Lapse of statute	—				—			—
Balance at December 31	$	70			82			142

Schedule of Effective Income Tax Rate Reconciliation

The amounts of U.S. and foreign income (loss) before income taxes, with a reconciliation of tax at the federal statutory rate with the provision for income taxes, were:

	Millions of Dollars										Percent of Pre-tax Income
	2016				2015			2014			2016			2015			2014
Income from continuing operations before income taxes
United States	$	1,713			4,983			5,121			78.2	%		82.4			89.1
Foreign	478				1,061			624			21.8			17.6			10.9
	$	2,191			6,044			5,745			100.0	%		100.0			100.0
Federal statutory income tax	$	767			2,115			2,011			35.0	%		35.0			35.0
Goodwill allocated to assets sold	—				41			18			—			0.7			0.3
Sale of foreign subsidiaries	—				(125	)		(293	)		—			(2.1	)		(5.1	)
Foreign rate differential	(152		)		(239	)		(184	)		(6.9	)		(3.9	)		(3.2	)
German tax legislation	—				(103	)		—			—			(1.7	)		—
Change in valuation allowance	(81		)		(17	)		(14	)		(3.7	)		(0.2	)		(0.2	)
Federal manufacturing deduction	—				(77	)		(81	)		—			(1.3	)		(1.4	)
State income tax, net of federal benefit	12				150			180			0.6			2.5			3.1
Other	1				19			17			—			0.2			0.3
	$	547			1,764			1,654			25.0	%		29.2			28.8

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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.

+ References

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-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 9
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Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets.

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-Topic 740
-SubTopic 10
-Section 50
-Paragraph 2
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Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

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Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
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Tabular disclosure of the change in unrecognized tax benefits.

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-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 10
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