XML 63 R28.htm IDEA: XBRL DOCUMENT v3.24.0.1
Income Taxes
 12 Months Ended
Feb. 03, 2024
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Earnings before income taxes were $5.3 billion, $3.4 billion, and $8.9 billion during 2023, 2022, and 2021, respectively, including $1.2 billion, $1.3 billion, and $896 million earned by our foreign entities subject to tax outside of the U.S.

Tax Rate Reconciliation2023 2022 2021 
Federal statutory rate21.0 %21.0 %21.0 %
State income taxes, net of the federal tax benefit3.8 3.0 3.9 
International(1.3)(2.1)(1.3)
Excess tax benefit related to share-based payments(0.3)(1.6)(0.8)
Federal tax credits(0.8)(1.5)(0.5)
Other(0.5)(0.1)(0.3)
Effective tax rate21.9 %18.7 %22.0 %


Provision for Income Taxes
(millions)
202320222021
Current:   
Federal$556 $(84)$1,111 
State208 33 325 
International97 107 3 
Total current861 56 1,439 
Deferred:   
Federal256 501 423 
State43 82 98 
International(1)(1)1 
Total deferred298 582 522 
Total provision$1,159 $638 $1,961 
Net Deferred Tax Asset / (Liability)
(millions)
February 3, 2024January 28, 2023
Gross deferred tax assets:  
Accrued and deferred compensation$392 $365 
Accruals and reserves not currently deductible256 233 
Self-insured benefits180 156 
Deferred occupancy income118 125 
Lease liabilities1,468 1,316 
Other92 142 
Total gross deferred tax assets2,506 2,337 
Gross deferred tax liabilities:  
Property and equipment(3,015)(2,613)
Leased assets(1,276)(1,115)
Inventory(500)(594)
Other(187)(205)
Total gross deferred tax liabilities(4,978)(4,527)
Total net deferred tax liability (a)
$(2,472)$(2,190)
(a)$8 million and $6 million of the balances as of February 3, 2024, and January 28, 2023, respectively, is included in Other Noncurrent Assets.

We file a U.S. federal income tax return and income tax returns in various states and foreign jurisdictions. The U.S. Internal Revenue Service (IRS) has completed exams on the U.S. federal income tax returns for years 2020 and prior. With few exceptions, we are no longer subject to state and local or non-U.S. income tax examinations by tax authorities for years before 2016.

Reconciliation of Gross Unrecognized Tax Benefits
(millions)
202320222021
Balance at beginning of period$233 $125 $181 
Additions based on tax positions related to the current year128 115 32 
Additions for tax positions of prior years8 21 11 
Reductions for tax positions of prior years(13)(23)(95)
Settlements(4)(5)(4)
Balance at end of period$352 $233 $125 

If we were to prevail on all unrecognized tax benefits recorded, the amount that would benefit the effective tax rate was $161 million, $107 million, and $67 million as of February 3, 2024, January 28, 2023, and January 29, 2022, respectively. In addition, the reversal of accrued interest and penalties would also benefit the effective tax rate. Interest and penalties associated with unrecognized tax benefits are recorded within income tax expense. During 2023, 2022, and 2021, we recorded an expense / (benefit) from accrued interest and penalties of $6 million, $(4) million, and $1 million, respectively. As of February 3, 2024, January 28, 2023, and January 29, 2022, total accrued interest and penalties were $14 million, $7 million, and $13 million, respectively.

It is reasonably possible that the amount of the unrecognized tax benefits with respect to our other unrecognized tax positions will increase or decrease during the next twelve months; however, an estimate of the amount or range of the change cannot be made at this time.