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INCOME TAXES (Tables) | 12 Months Ended
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Dec. 31, 2023
Income Tax Disclosure [Abstract] |
Summary of Components of Income from Operations before Provision for Income Taxes | The components of the income before income taxes for the Company’s domestic and foreign operations for the years ended December 31 are provided below:
|  | For the year ended December 31,
In millions |  | 2023 |  | 2022 |  | 2021
Domestic |  | $ | 506 |  |  | $ | 372 |  |  | $ | 253 |
Foreign |  | 586 |  |  | 482 |  |  | 484 |
Income before income taxes |  | $ | 1,092 |  |  | $ | 854 |  |  | $ | 737 |
Summary of Consolidated Provision for Income Taxes | The consolidated provision for income taxes included in the Consolidated Statements of Income consisted of the following:
|  | For the year ended December 31,
In millions |  | 2023 |  | 2022 |  | 2021
Current tax expense (benefit) |  |  |  |  |  |
Federal |  | $ | 148 |  |  | $ | 37 |  |  | $ | (81) |
State |  | 29 |  |  | 3 |  |  | 27 |
Foreign |  | 148 |  |  | 137 |  |  | 138 |
|  | 325 |  |  | 177 |  |  | 84 |
Deferred tax (benefit) expense |  |  |  |  |  |
Federal |  | (50) |  |  | 29 |  |  | 87 |
State |  | 1 |  |  | — |  |  | 10 |
Foreign |  | (9) |  |  | 7 |  |  | (9) |
|  | (58) |  |  | 36 |  |  | 88 |
Total provision |  | $ | 267 |  |  | $ | 213 |  |  | $ | 172 |
Summary of Reconciliation of Income Tax Rate | A reconciliation of the United States federal statutory income tax rate to the effective income tax rate on operations for the years ended December 31 is provided below:
|  | For the year ended December 31,
In millions |  | 2023 |  | 2022 |  | 2021
U.S. federal statutory rate |  | 21.0 | % |  | 21.0 | % |  | 21.0 | %
State taxes |  | 1.5 |  |  | 2.0 |  |  | 0.3 |
Foreign |  | 2.0 |  |  | 3.8 |  |  | 3.3 |
Research and development credit |  | (0.6) |  |  | (0.8) |  |  | (0.8) |
Non-taxable gain on acquisition |  | (0.8) |  |  | — |  |  | — |
U.S. net operating loss carryback |  | — |  |  | — |  |  | (3.4) |
Changes in valuation allowances |  | 1.0 |  |  | (2.0) |  |  | 3.0 |
U.S. tax reform provision |  | 0.6 |  |  | 0.1 |  |  | 0.7 |
Other, net |  | (0.2) |  |  | 0.9 |  |  | (0.9) |
Effective rate |  | 24.5 | % |  | 25.0 | % |  | 23.2 | %
Summary of Components of Deferred Tax Assets and Liabilities | Components of deferred tax assets and liabilities were as follows:
|  | December 31,
In millions |  | 2023 |  | 2022
Deferred income tax assets: |  |  |  |
Accrued expenses and reserves |  | $ | 50 |  |  | $ | 39 |
Warranty reserve |  | 49 |  |  | 49 |
Deferred compensation/employee benefits |  | 77 |  |  | 61 |
Right-of-use assets |  | 78 |  |  | 74 |
Pension and postretirement obligations |  | 16 |  |  | 19 |
Inventory |  | 49 |  |  | 49 |
Deferred revenue |  | 84 |  |  | 52 |
Net operating loss carry forwards |  | 124 |  |  | 102 |
Other |  | 51 |  |  | 37 |
Gross deferred income tax assets |  | 578 |  |  | 482 |
Less: Valuation allowance |  | (58) |  |  | (46) |
Total deferred income tax assets |  | 520 |  |  | 436 |
Deferred income tax liabilities: |  |  |  |
Property, plant & equipment |  | 64 |  |  | 78 |
Right-of-use liabilities |  | 75 |  |  | 72 |
Intangible assets |  | 610 |  |  | 542 |
Total deferred income tax liabilities |  | 749 |  |  | 692 |
Net deferred income tax liability |  | $ | 229 |  |  | $ | 256 |
Summary of Liability for Income Taxes Associated with Uncertain Tax Positions | A reconciliation of the beginning and ending amount of the gross liability for income taxes associated with unrecognized tax benefits follows:
In millions |  | 2023 |  | 2022 |  | 2021
Balance at beginning of year |  | $ | 33 |  |  | $ | 32 |  |  | $ | 16 |
Unrecognized tax benefits in prior periods |  | 13 |  |  | 1 |  |  | 19 |
Audit settlement during year |  | (5) |  |  | — |  |  | (1) |
Expiration of audit statute of limitations |  | (1) |  |  | — |  |  | (2) |
Balance at end of year |  | $ | 40 |  |  | $ | 33 |  |  | $ | 32 |

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- Definition 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. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Paragraph 12 -Section 50 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-12 + Details
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- Definition Tabular disclosure for tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities and other income tax contingencies. Includes, but is not limited to, interest and penalties, reconciliation of unrecognized tax benefits, unrecognized tax benefits that would affect the effective tax rate, tax years that remain subject to examination by tax jurisdictions, and information about positions for which it is reasonably possible that amounts unrecognized will significantly change within 12 months. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 15 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-15 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 15A -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-15A Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Section 50 -Paragraph 19 -SubTopic 10 -Topic 740 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-19 + Details
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