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Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2019
Income Tax Disclosure [Abstract] |
Income Taxes | INCOME TAXES The income tax provision (benefit) differed from amounts computed at the statutory federal income tax rate and consisted of the following significant components (in millions):
UAL |  | 2019 |  | 2018 (a) |  | 2017 (a)
Income tax provision at statutory rate |  | $ | 822 |  |  | $ | 556 |  |  | $ | 1,058 |
State income taxes, net of federal income tax benefit |  | 50 |  |  | 29 |  |  | 30 |
Foreign tax rate differential |  | (90 | ) |  | (84 | ) |  | (43 | )
Global intangible low-taxed income |  | 90 |  |  | 4 |  |  | — |
Foreign income taxes |  | 1 |  |  | 2 |  |  | 3 |
Nondeductible employee meals |  | 12 |  |  | 12 |  |  | 17 |
Impact of Tax Act |  | — |  |  | (5 | ) |  | (189 | )
State rate change |  | — |  |  | 3 |  |  | 12 |
Valuation allowance |  | (4 | ) |  | (3 | ) |  | (16 | )
Other, net |  | 24 |  |  | 12 |  |  | 8 |
|  | $ | 905 |  |  | $ | 526 |  |  | $ | 880 |
Current |  | $ | 23 |  |  | $ | 14 |  |  | $ | (77 | )
Deferred |  | 882 |  |  | 512 |  |  | 957 |
|  | $ | 905 |  |  | $ | 526 |  |  | $ | 880 |
United |  | 2019 |  | 2018 (a) |  | 2017 (a)
Income tax provision at statutory rate |  | $ | 822 |  |  | $ | 557 |  |  | $ | 1,059 |
State income taxes, net of federal income tax |  | 50 |  |  | 29 |  |  | 30 |
Foreign tax rate differential |  | (90 | ) |  | (84 | ) |  | (43 | )
Global intangible low-taxed income |  | 90 |  |  | 4 |  |  | — |
Foreign income taxes |  | 1 |  |  | 2 |  |  | 3 |
Nondeductible employee meals |  | 12 |  |  | 12 |  |  | 17 |
Impact of Tax Act |  | — |  |  | (5 | ) |  | (206 | )
State rate change |  | — |  |  | 3 |  |  | 12 |
Valuation allowance |  | (4 | ) |  | (3 | ) |  | (16 | )
Other, net |  | 24 |  |  | 12 |  |  | 8 |
|  | $ | 905 |  |  | $ | 527 |  |  | $ | 864 |
Current |  | $ | 23 |  |  | $ | 14 |  |  | $ | (77 | )
Deferred |  | 882 |  |  | 513 |  |  | 941 |
|  | $ | 905 |  |  | $ | 527 |  |  | $ | 864 |
(a) Amounts adjusted due to the adoption of Accounting Standards Update No. 2016-02, Leases (Topic 842). See Note 1 of this report for additional information on the adjustments. The Company's effective tax rate for the year ended December 31, 2019 differed from the federal statutory rate of 21% due to a blend of federal, state and foreign taxes as well as the impact of certain nondeductible items. On December 22, 2017, Congress enacted the Tax Act, which made significant changes to U.S. federal income tax laws, including reducing the corporate rate from 35% to 21% effective January 1, 2018. The Tax Act included a Global Intangible Low-Taxed Income ("GILTI") provision which introduced a new tax on foreign income in excess of a deemed return on tangible business property of foreign subsidiaries. The GILTI provisions of the Tax Act became effective for the Company during 2018 and we elected to account for it in the period incurred (the "period cost method"). The increase in the GILTI for the year ended December 31, 2019 is due to a full-year inclusion in 2019 as compared to a partial-year inclusion in 2018. Additionally, the Company did not satisfy the minimum taxable income requirement to benefit from the 50% GILTI deduction provided by the Tax Act. Temporary differences and carryforwards that give rise to deferred tax assets and liabilities at December 31, 2019 and 2018 were as follows (in millions):
|  | UAL |  | United
|  | 2019 |  | 2018 |  | 2019 |  | 2018
Deferred income tax asset (liability): |  |  |  |  |  |  |  |
Federal and state net operating loss ("NOL") carryforwards |  | $ | 695 |  |  | $ | 398 |  |  | $ | 668 |  |  | $ | 371 |
Deferred revenue |  | 1,287 |  |  | 1,232 |  |  | 1,287 |  |  | 1,232 |
Employee benefits, including pension, postretirement and medical |  | 715 |  |  | 885 |  |  | 715 |  |  | 885 |
Operating lease liabilities |  | 1,256 |  |  | 1,338 |  |  | 1,256 |  |  | 1,338 |
Other |  | 165 |  |  | 229 |  |  | 165 |  |  | 229 |
Less: Valuation allowance |  | (58 | ) |  | (59 | ) |  | (58 | ) |  | (59 | )
Total deferred tax assets |  | $ | 4,060 |  |  | $ | 4,023 |  |  | $ | 4,033 |  |  | $ | 3,996 |
Depreciation |  | $ | (4,011 | ) |  | $ | (2,929 | ) |  | $ | (4,011 | ) |  | $ | (2,929 | )
Operating lease right-of-use asset |  | (1,061 | ) |  | (1,173 | ) |  | (1,061 | ) |  | (1,173 | )
Intangibles |  | (724 | ) |  | (749 | ) |  | (724 | ) |  | (749 | )
Total deferred tax liabilities |  | $ | (5,796 | ) |  | $ | (4,851 | ) |  | $ | (5,796 | ) |  | $ | (4,851 | )
Net deferred tax liability |  | $ | (1,736 | ) |  | $ | (828 | ) |  | $ | (1,763 | ) |  | $ | (855 | )
United and its domestic consolidated subsidiaries file a consolidated federal income tax return with UAL. Under an intercompany tax allocation policy, United and its subsidiaries compute, record and pay UAL for their own tax liability as if they were separate companies filing separate returns. In determining their own tax liabilities, United and each of its subsidiaries take into account all tax credits or benefits generated and utilized as separate companies and they are each compensated for the aforementioned tax benefits only if they would be able to use those benefits on a separate company basis. The Company's federal and state NOL carryforwards relate to prior years' NOLs, which may be used to reduce tax liabilities in future years. These tax benefits are mostly attributable to federal pre-tax NOL carryforwards of $3.0 billion for UAL. If not utilized these federal pre-tax NOLs will expire as follows (in billions): $0.7 billion in 2030, $0.5 billion in 2033, and $0.5 billion in 2034. The remaining $1.3 billion of NOLs has no expiration date. In addition, for UAL the majority of tax benefits of the state NOLs of $100 million expire over a five to twenty year period. We have recorded a $45 million valuation allowance against these state NOLs. The Company's unrecognized tax benefits related to uncertain tax positions were $53 million, $39 million and $21 million at December 31, 2019, 2018 and 2017, respectively. Included in the ending balance at December 31, 2019 is $53 million that would affect the Company's effective tax rate if recognized. The changes in unrecognized tax benefits relating to settlements with taxing authorities, unrecognized tax benefits as a result of tax positions taken during a prior period and unrecognized tax benefits relating from a lapse of the statute of limitations were immaterial during 2019, 2018 and 2017. The Company does not expect significant increases or decreases in their unrecognized tax benefits within the next 12 months. There are no material amounts included in the balance at December 31, 2019 for tax positions for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility. The Company's federal income tax returns for tax years after 2002 remain subject to examination by the Internal Revenue Service (the "IRS") and state taxing jurisdictions. We are currently under audit by the IRS for the 2016 and 2017 tax years.

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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