XML 35 R18.htm IDEA: XBRL DOCUMENT
v3.25.0.1

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2024
Income Tax Disclosure [Abstract] |
Income Taxes | INCOME TAXES Earnings before income taxes consisted of the following:
| December 31,
(DOLLARS IN MILLIONS) | 2024 |  | 2023 |  | 2022
U.S. income (loss) before taxes | $ | (810) |  |  | $ | (1,777) |  |  | $ | (1,918) |
Foreign income (loss) before taxes | 1,088 |  |  | (741) |  |  | 293 |
Total income (loss) before taxes | $ | 278 |  |  | $ | (2,518) |  |  | $ | (1,625) |
The income tax provision consisted of the following:
| December 31,
(DOLLARS IN MILLIONS) | 2024 |  | 2023 |  | 2022
Current tax provision |  |  |  |  |
Federal | $ | (57) |  |  | $ | 55 |  |  | $ | 102 |
State and local | 8 |  |  | — |  |  | 49 |
Foreign | 384 |  |  | 359 |  |  | 325 |
Total current tax provision | 335 |  |  | 414 |  |  | 476 |
Deferred tax provision |  |  |  |  |
Federal | (203) |  |  | (113) |  |  | (77) |
State and local | (24) |  |  | 32 |  |  | (111) |
Foreign | (77) |  |  | (288) |  |  | (49) |
Total deferred tax benefit | (304) |  |  | (369) |  |  | (237) |
Total provision for income taxes | $ | 31 |  |  | $ | 45 |  |  | $ | 239 |
Effective Tax Rate Reconciliation Reconciliation between the U.S. federal statutory income tax rate to the actual effective tax rate was as follows:
| December 31,
| 2024 |  | 2023 |  | 2022
Statutory tax rate | 21.0 | % |  | 21.0 | % |  | 21.0 | %
Tax effect of non-deductible goodwill impairment | — |  |  | (20.4) |  |  | (29.1) |
Difference in effective tax rate on foreign earnings and remittances | 26.6 |  |  | (0.2) |  |  | — |
Tax benefit from supply chain optimization | (4.0) |  |  | 0.5 |  |  | 0.8 |
Unrecognized tax benefit, net of reversals | 5.3 |  |  | (0.8) |  |  | 0.9 |
Tax impact on business divestitures | (19.1) |  |  | (3.7) |  |  | (5.9) |
Deferred taxes on deemed repatriation(1) | 0.2 |  |  | 0.5 |  |  | (5.6) |
Global intangible low-taxed income | 9.8 |  |  | (0.4) |  |  | (0.8) |
Foreign-derived intangible income | — |  |  | — |  |  | 1.1 |
U.S. foreign tax credit - general limitation | (7.9) |  |  | 0.2 |  |  | 0.1 |
Research and development credit | (6.6) |  |  | 0.5 |  |  | 0.8 |
State and local taxes including rate changes(2) | (4.8) |  |  | (1.7) |  |  | 4.3 |
Tax impact on internal asset transfer | (8.6) |  |  | 5.3 |  |  | — |
Other, net | (0.7) |  |  | (2.6) |  |  | (2.3) |
Effective tax rate | 11.2 | % |  | (1.8) | % |  | (14.7) | %
_______________________ (1)For 2022, 2023 and 2024, the rate includes the establishment of the held for sale deferred tax liabilities due to a change in assertion. (2)For 2022, 2023 and 2024, the rate includes rate change impacts related to the remeasurement of the state tax rate on deferred taxes. The effective tax rate reflects the recording of the tax effects of the divestiture of the Cosmetic Ingredients business. The Company has elected to treat global intangible low-taxed income (“GILTI”) as a current period cost if and when incurred. This tax position resulted in a net income tax expense of approximately $184 million for the year ended December 31, 2024, offset in part by foreign tax credits of approximately $146 million. Deferred Taxes The deferred tax assets and liabilities, shown before jurisdictional netting, consisted of the following amounts:
| December 31,
(DOLLARS IN MILLIONS) | 2024 |  | 2023
Employee and retiree benefits | $ | 90 |  |  | $ | 118 |
Credit and net operating loss carryforwards | 288 |  |  | 332 |
Amortizable research and development expenses | 154 |  |  | 125 |
Interest limitation | 226 |  |  | 127 |
Inventory | 29 |  |  | 35 |
Lease obligations | 146 |  |  | 170 |
Other, net | 99 |  |  | 114 |
Gross deferred tax assets | 1,032 |  |  | 1,021 |
Property, plant and equipment, net | (203) |  |  | (239) |
Intangible assets(1) | (1,516) |  |  | (1,792) |
Right-of-use assets | (135) |  |  | (170) |
Deferred taxes on deemed repatriation | (154) |  |  | (155) |
Gross deferred tax liabilities | (2,008) |  |  | (2,356) |
Valuation allowance | (376) |  |  | (324) |
Total net deferred tax liabilities | $ | (1,352) |  |  | $ | (1,659) |
_______________________ (1)Includes deferred taxes on intangible assets owned by a fully consolidated partnership. Net operating loss carryforwards were approximately $267 million and $311 million as of December 31, 2024 and 2023, respectively. If unused, approximately $55 million will expire between 2025 and 2044. The remainder, totaling approximately $212 million, may be carried forward indefinitely. Tax credit carryforwards were approximately $21 million and $21 million as of December 31, 2024 and 2023, respectively. If unused, the $21 million will expire between 2025 and 2044. Of the deferred tax assets at December 31, 2024, the Company considers it unlikely that a portion of the tax benefit will be realized. Accordingly, a valuation allowance of approximately $376 million has been established against these deferred tax assets. Uncertain Tax Positions A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
| December 31,
(DOLLARS IN MILLIONS) | 2024 |  | 2023 |  | 2022
Balance of unrecognized tax benefits at beginning of year | $ | 123 |  |  | $ | 112 |  |  | $ | 130 |
Gross amount of increases in unrecognized tax benefits as a result of positions taken during a prior year | 44 |  |  | 1 |  |  | 1 |
Gross amount of decreases in unrecognized tax benefits as a result of positions taken during a prior year | (11) |  |  | — |  |  | (18) |
Gross amount of increases in unrecognized tax benefits as a result of positions taken during the current year | 15 |  |  | 19 |  |  | 31 |
The amounts of decreases in unrecognized benefits relating to settlements with taxing authorities | (5) |  |  | (3) |  |  | (27) |
Reduction in unrecognized tax benefits due to the lapse of applicable statute of limitation | (8) |  |  | (6) |  |  | (5) |
Balance of unrecognized tax benefits at end of year | $ | 158 |  |  | $ | 123 |  |  | $ | 112 |
_______________________ As of December 31, 2024, 2023 and 2022, there were approximately $158 million, $123 million and $98 million, respectively, of unrecognized tax benefits recorded to Other liabilities. There were no amounts recorded to Other current liabilities for 2024. There were no amounts recorded to Other current liabilities for 2023 and approximately $14 million recorded in 2022. If these unrecognized tax benefits were recognized, all the benefits and related interest and penalties would be recorded as a benefit to income tax expense. The Company increased its liabilities for interest and penalties by approximately $11 million, net, for the year ended December 31, 2024. The Company increased its liabilities for interest and penalties by approximately $12 million, net, and decreased its liabilities for interest and penalties by approximately $1 million, net, for the years ended December 31, 2023 and 2022, respectively. As of December 31, 2024, 2023 and 2022, the Company had accrued approximately $58 million, $47 million and $31 million, respectively, of interest and penalties classified as Other liabilities. As of December 31, 2024 and 2023, the Company had no accruals of interest and penalties classified as Other current liabilities. In 2022, the Company had accrued approximately $4 million of interest and penalties classified as Other current liabilities. As of December 31, 2024, the Company’s aggregate provision for unrecognized tax benefits, including interest and penalties, was approximately $216 million associated with various tax positions principally asserted in foreign jurisdictions. As of December 31, 2024, all the unrecognized tax benefits, if recognized, would affect the effective tax rate. The total changes to uncertain tax positions over the next 12 months is impracticable to estimate and is dependent on the resolution of new or existing tax disputes. Other Tax benefits credited to Shareholders’ equity were not material for the years ended December 31, 2024, 2023 and 2022 associated with stock option exercises and PRSU dividends. The Company regularly repatriates earnings from non-U.S. subsidiaries. As the Company repatriates these funds to the U.S., there will be required income taxes payable in certain U.S. states and applicable foreign withholding taxes during the period when such repatriation occurs. Accordingly, as of December 31, 2024, the Company had a deferred tax liability of approximately $154 million for the effect of repatriating the funds to the U.S., attributable to various non-U.S. subsidiaries. There is no deferred tax liability associated with non-U.S. subsidiaries where the Company intends to indefinitely reinvest the earnings to fund local operations and/or capital projects. The Company has ongoing income tax audits and legal proceedings which are at various stages of administrative or judicial review. In addition, the Company has other ongoing tax audits and legal proceedings that relate to indirect taxes, such as value-added taxes, capital tax, sales and use and property taxes, which are discussed in Note 21. The Company also has several other tax audits in process and has open tax years with various taxing jurisdictions that range primarily from 2011 to 2023.

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 tax. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 231 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482663/740-10-55-231 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12C -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12C Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12B -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12B Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147477891/740-270-50-1 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB Topic 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480990/946-20-50-13 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/740/tableOfContent Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-14 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-21 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-17 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-2 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482603/740-30-50-2 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration