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Income Taxes | 12 Months Ended
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Dec. 31, 2022
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):
|  | 2022 |  | 2021 |  | 2020
Income tax provision (benefit) at statutory rate |  | $ | 208 |  |  | $ | (537) |  |  | $ | (1,852) |
State income tax provision (benefit), net of federal income tax benefit |  | 13 |  |  | (34) |  |  | (110) |
Nondeductible employee meals |  | 12 |  |  | 7 |  |  | 5 |
Nondeductible transportation fringe benefit |  | 10 |  |  | 8 |  |  | 7 |
Valuation allowance |  | (10) |  |  | (38) |  |  | 197 |
Other, net |  | 20 |  |  | 1 |  |  | — |
Income tax expense (benefit) |  | $ | 253 |  |  | $ | (593) |  |  | $ | (1,753) |
Current |  | $ | 5 |  |  | $ | (10) |  |  | $ | (12) |
Deferred |  | 248 |  |  | (583) |  |  | (1,741) |
Income tax expense (benefit) |  | $ | 253 |  |  | $ | (593) |  |  | $ | (1,753) |
Temporary differences and carryforwards that give rise to deferred tax assets and liabilities at December 31, 2022 and 2021 were as follows (in millions):
|  | UAL |  | United
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Deferred income tax asset (liability): |  |  |  |  |  |  |  |
Federal and state net operating loss ("NOL") carryforwards |  | $ | 2,932 |  |  | $ | 2,229 |  |  | $ | 2,903 |  |  | $ | 2,201 |
Deferred revenue |  | 1,783 |  |  | 2,349 |  |  | 1,783 |  |  | 2,349 |
Employee benefits, including pension, postretirement and medical |  | 606 |  |  | 986 |  |  | 606 |  |  | 986 |
Operating lease liabilities |  | 1,118 |  |  | 1,272 |  |  | 1,118 |  |  | 1,272 |
Other financing liabilities |  | 141 |  |  | 327 |  |  | 141 |  |  | 327 |
Interest expense carryforward |  | 510 |  |  | — |  |  | 510 |  |  | — |
Other |  | 576 |  |  | 535 |  |  | 576 |  |  | 535 |
Less: Valuation allowance |  | (199) |  |  | (210) |  |  | (199) |  |  | (210) |
Total deferred tax assets |  | $ | 7,467 |  |  | $ | 7,488 |  |  | $ | 7,438 |  |  | $ | 7,460 |
Depreciation |  | $ | (5,844) |  |  | $ | (5,122) |  |  | $ | (5,844) |  |  | $ | (5,122) |
Operating lease right-of-use asset |  | (881) |  |  | (1,051) |  |  | (881) |  |  | (1,051) |
Intangibles |  | (651) |  |  | (656) |  |  | (651) |  |  | (656) |
Total deferred tax liabilities |  | $ | (7,376) |  |  | $ | (6,829) |  |  | $ | (7,376) |  |  | $ | (6,829) |
Net deferred tax asset |  | $ | 91 |  |  | $ | 659 |  |  | $ | 62 |  |  | $ | 631 |
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 recorded a deferred tax asset for a temporary interest expense limitation under Internal Revenue Code ("IRC") section 163(j) due to law changes resulting from the CARES Act. Interest expense disallowed under IRC section 163(j) can be carried forward indefinitely and deducted in future years. The Company's federal and state NOL and tax credit carryforwards relate to current and prior years' NOLs and credits, which may be used to reduce tax liabilities in future years. These tax benefits are mostly attributable to federal pre-tax NOL carryforwards of $13.2 billion ($2.8 billion tax effected) for UAL. If not utilized these federal pre-tax NOLs will expire as follows (in billions): $0.1 in 2026, $0.5 in 2028, $0.4 in 2029, $0.2 in 2032 and $0.4 in 2033. The remaining $11.6 billion of NOLs has no expiration date. State pre-tax NOLs of $3.9 billion ($0.2 billion tax effected) expire over a 1 to 20-year period. Federal tax credits of $44 million will expire over a 1 to 20-year period and state tax credits of $45 million will expire over a 1 to 15-year period. A tax valuation allowance is recognized if it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company's management assesses available positive and negative evidence regarding the Company's ability to realize its deferred tax assets and records a valuation allowance when it is more likely than not that deferred tax assets will not be realized. In order to form a conclusion, management considers positive evidence in the form of taxable income in prior carryback years, reversing temporary differences, tax planning strategies and projections of future taxable income during the periods in which those temporary differences become deductible, as well as negative evidence such as historical losses. Although the Company incurred losses in 2021 and 2020, management determined that these results were not indicative of future results due to the impact of the COVID-19 pandemic on its operations. The Company concluded that the positive evidence outweighs the negative evidence, primarily driven by approval and distribution of COVID-19 vaccines as well as increased confidence with the timing of the recovery, as evidenced in our 2022 return to profitability. One of the Company's largest deferred tax assets was its federal pre-tax NOLs which were $13.2 billion ($2.8 billion tax effected) at December 31, 2022. The majority of the NOLs do not expire and the Company expects to realize the benefits of the NOLs and other deferred tax assets through the reversal of certain existing deferred tax liabilities of $6.7 billion and the remaining $0.8 billion through projected future taxable income. Therefore, we have not recorded a valuation allowance on our deferred tax assets other than the capital loss carryforwards and certain state attributes that have short expiration periods. While the Company expects to generate sufficient future income to fully utilize its deferred tax assets (including NOLs), the Company may have to record a valuation allowance, which could be material, against deferred tax assets if negative evidence such as reduced forecasted income outweigh positive evidence. Assumptions about future taxable income are consistent with the plans and estimates used to manage our business. Management will continue to evaluate future financial performance to determine whether such performance is both sustained and significant enough to provide sufficient evidence to support not recording valuation allowance on these NOLs. As of December 31, 2022, the Company has recorded $175 million of valuation allowance against its capital loss deferred tax assets. Capital losses have a limited carryforward period of five years, and they can be utilized only to the extent of capital gains. The Company does not anticipate generating sufficient capital gains to utilize the losses before they expire, therefore, a valuation allowance is necessary as of December 31, 2022. Additionally, the Company recorded a valuation allowance of $24 million on certain state deferred tax assets primarily due to state NOLs that have short expiration periods. The Company's unrecognized tax benefits related to uncertain tax positions were $58 million, $55 million and $57 million at December 31, 2022, 2021 and 2020, respectively. Included in the ending balance at December 31, 2022 is $58 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 2022, 2021 and 2020. 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, 2022 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.

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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/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI https://asc.fasb.org/extlink&oid=121826272&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 https://asc.fasb.org/extlink&oid=122134291&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 https://asc.fasb.org/extlink&oid=121826272&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 https://asc.fasb.org/extlink&oid=122134291&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 https://asc.fasb.org/extlink&oid=121826272&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 https://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 https://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 https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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