XML 95 R32.htm IDEA: XBRL DOCUMENT
v3.20.4

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2020
Income Tax Disclosure [Abstract] |
Income Taxes [Text Block] | Income Taxes The components of income tax provision attributable to continuing operations were as follows:
| Years Ended December 31,
2020 |  | 2019 |  | 2018
(in millions)
Current income tax |  |  |  |  |
Federal | $ | 527 |  |  | $ | 531 |  |  | $ | 275 |
State and local | 63 |  |  | 80 |  |  | 45 |
Foreign | 28 |  |  | 36 |  |  | 41 |
Total current income tax | 618 |  |  | 647 |  |  | 361 |
Deferred income tax |  |  |  |  |
Federal | (309) |  |  | (297) |  |  | 20 |
State and local | (16) |  |  | (13) |  |  | 2 |
Foreign | 4 |  |  | 2 |  |  | 3 |
Total deferred income tax | (321) |  |  | (308) |  |  | 25 |
Total income tax provision | $ | 297 |  |  | $ | 339 |  |  | $ | 386 |
On December 22, 2017, the Tax Act was signed into law. In 2018, the Company finalized its accounting related to the Tax Act and recorded a $3 million benefit related to foreign provisions. The geographic sources of pretax income from continuing operations were as follows:
| Years Ended December 31,
| 2020 |  | 2019 |  | 2018
| (in millions)
United States | $ | 1,685 |  |  | $ | 2,045 |  |  | $ | 2,263 |
Foreign | 146 |  |  | 187 |  |  | 221 |
Total | $ | 1,831 |  |  | $ | 2,232 |  |  | $ | 2,484 |
The principal reasons that the aggregate income tax provision attributable to continuing operations is different from that computed by using the U.S. statutory rates of 21% were as follows:
| Years Ended December 31,
2020 |  | 2019 |  | 2018
Tax at U.S. statutory rate | 21.0 | % |  | 21.0 | % |  | 21.0 | %
Changes in taxes resulting from: |  |  |  |  |
Low income housing tax credits | (4.3) |  |  | (3.6) |  |  | (3.2) |
State taxes, net of federal benefit | 2.1 |  |  | 2.4 |  |  | 1.5 |
Dividends received deduction | (2.1) |  |  | (1.8) |  |  | (1.6) |
Incentive compensation | (1.4) |  |  | — |  |  | — |
Foreign tax credits, net of addback | — |  |  | (2.2) |  |  | (1.1) |
Other, net | 0.9 |  |  | (0.6) |  |  | (1.1) |
Income tax provision | 16.2 | % |  | 15.2 | % |  | 15.5 | %
Deferred income tax assets and liabilities result from temporary differences between the assets and liabilities measured for GAAP reporting versus income tax return purposes. Deferred income tax assets and liabilities are measured at the statutory rate of 21% as of both December 31, 2020 and 2019. The significant components of the Company’s deferred income tax assets and liabilities, which are included net within other assets or other liabilities on the Consolidated Balance Sheets, were as follows:
| December 31,
2020 |  | 2019
(in millions)
Deferred income tax assets
Liabilities for policyholder account balances, future policy benefits and claims | $ | 1,618 |  |  | $ | 945 |
Deferred compensation | 493 |  |  | 406 |
Postretirement benefits | 65 |  |  | 45 |
Right of use lease liability | 60 |  |  | 59 |
Investment related | — |  |  | 188 |
Other | 51 |  |  | 47 |
Gross deferred income tax assets | 2,287 |  |  | 1,690 |
Less: valuation allowance | 15 |  |  | 19 |
Total deferred income tax assets | 2,272 |  |  | 1,671 |
Deferred income tax liabilities |  |  |
Deferred acquisition costs | 435 |  |  | 456 |
Net unrealized gains on Available-for-Sale securities | 295 |  |  | 186 |
Investment related | 253 |  |  | — |
Intangible assets | 124 |  |  | 115 |
Depreciation expense | 99 |  |  | 94 |
Goodwill | 70 |  |  | 64 |
Right of use lease asset | 54 |  |  | 54 |
Deferred sales inducement costs | 44 |  |  | 50 |
Other | 18 |  |  | 6 |
Gross deferred income tax liabilities | 1,392 |  |  | 1,025 |
Net deferred income tax assets | $ | 880 |  |  | $ | 646 |
Included in the Company’s deferred income tax assets are tax benefits primarily related to state net operating losses of $16 million, net of federal benefit, which will expire beginning December 31, 2021. Based on analysis of the Company’s tax position, management believes it is more likely than not that the Company will not realize certain state net operating losses of $11 million, state deferred tax assets of $2 million and foreign deferred tax assets of $2 million; therefore, a valuation allowance of $15 million has been established. A reconciliation of the beginning and ending amount of gross unrecognized tax benefits was as follows:
| 2020 |  | 2019 |  | 2018
| (in millions)
Balance at January 1 | $ | 100 |  |  | $ | 92 |  |  | $ | 76 |
Additions based on tax positions related to the current year | 11 |  |  | 15 |  |  | 22 |
Reductions based on tax positions related to the current year | (1) |  |  | — |  |  | — |
Additions for tax positions of prior years | 10 |  |  | 39 |  |  | 9 |
Reductions for tax positions of prior years | (4) |  |  | (17) |  |  | (3) |
Reductions due to lapse of statute of limitations | (5) |  |  | — |  |  | — |
Audit settlements | (1) |  |  | (29) |  |  | (12) |
Balance at December 31 | $ | 110 |  |  | $ | 100 |  |  | $ | 92 |
If recognized, approximately $80 million, $67 million and $70 million, net of federal tax benefits, of unrecognized tax benefits as of December 31, 2020, 2019, and 2018, respectively, would affect the effective tax rate. It is reasonably possible that the total amount of unrecognized tax benefits will change in the next 12 months. The Company estimates that the total amount of gross unrecognized tax benefits may decrease by $20 million to $30 million in the next 12 months primarily due to Internal Revenue Service (“IRS”) settlements and state exams. The Company recognizes interest and penalties related to unrecognized tax benefits as a component of the income tax provision. The Company recognized a net increase of $2 million, a net decrease of $2 million, and a net increase of $2 million, in interest and penalties for the years ended December 31, 2020, 2019, and 2018, respectively. As of December 31, 2020 and 2019, the Company had a payable of $10 million and $8 million, respectively, related to accrued interest and penalties. The Company or one or more of its subsidiaries files income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. The federal statute of limitations are closed on years through 2015, except for one issue for 2014 and 2015 which was claimed on amended returns. The IRS is currently auditing the Company’s U.S. income tax returns for 2016, 2017 and 2018. The Company’s state income tax returns are currently under examination by various jurisdictions for years ranging from 2010 through 2019. In the United Kingdom (“UK”), Her Majesty’s Revenue and Customs is performing a business risk review of the Company’s UK subsidiaries for the 2016 tax year.

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 http://asc.fasb.org/extlink&oid=84230637&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 http://asc.fasb.org/extlink&oid=116825942&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 http://asc.fasb.org/extlink&oid=84230637&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 http://asc.fasb.org/extlink&oid=116825942&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 http://asc.fasb.org/extlink&oid=84230637&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 http://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 http://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 http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration