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INCOME TAXES (Tables) | 12 Months Ended
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Dec. 31, 2018
Income Tax Disclosure [Abstract] |
Schedule of Components of Earnings (Loss) from Continuing Operations and Provisions for Income Taxes | Components of earnings before income taxes and the provision for (benefit from) U.S. and other income taxes from operations follow:
| For years ended December 31,
(Dollars in millions) | 2018 |  | 2017 |  | 2016
Earnings before income taxes |  |  |  |  |
United States | $ | 718 |  |  | $ | 654 |  |  | $ | 422 |
Outside the United States | 592 |  |  | 635 |  |  | 627 |
Total | $ | 1,310 |  |  | $ | 1,289 |  |  | $ | 1,049 |
Provision for (benefit from) income taxes |  |  |  |  |  |  |  |
United States Federal |  |  |  |  |  |  |  |
Current (1) | $ | 161 |  |  | $ | 220 |  |  | $ | (80 | )
Deferred (2) | (11 | ) |  | (383 | ) |  | 214 |
Outside the United States |  |  |  |  |
Current | 86 |  |  | 62 |  |  | 91 |
Deferred | (22 | ) |  | 2 |  |  | (18 | )
State and other |  |  |  |  |
Current | 30 |  |  | 13 |  |  | 2 |
Deferred | (18 | ) |  | (13 | ) |  | (19 | )
Total | $ | 226 |  |  | $ | (99 | ) |  | $ | 190 |
(1) | A one-time transition tax of $71 million on deferred foreign income tax is included for 2017.
(2) | Includes a one-time benefit of $517 million primarily due to the re-measurement of certain net deferred tax liabilities using the lower U.S. corporate income tax rate and a one-time $72 million valuation allowance on deferred tax assets for foreign tax credit carryforwards for 2017.
Schedule of Deferred Tax Charge (Benefit) Recorded as a Component of Accumulated Other Comprehensive Loss | The following represents the deferred tax (benefit) charge recorded as a component of AOCI in the Consolidated Statements of Financial Position:
| For years ended December 31,
(Dollars in millions) | 2018 |  | 2017 |  | 2016
Defined benefit pension and other postretirement benefit plans | $ | (10 | ) |  | $ | (16 | ) |  | $ | 21 |
Derivatives and hedging | 3 |  |  | 8 |  |  | 105 |
Total | $ | (7 | ) |  | $ | (8 | ) |  | $ | 126 |
Schedule of Income Tax Expense (Benefit) Included in Consolidated Financial Statement | Total income tax expense (benefit) included in the consolidated financial statements was composed of the following:
| For years ended December 31,
(Dollars in millions) | 2018 |  | 2017 |  | 2016
Earnings before income taxes | $ | 226 |  |  | $ | (99 | ) |  | $ | 190 |
Other comprehensive income | (7 | ) |  | (8 | ) |  | 126 |
Total | $ | 219 |  |  | $ | (107 | ) |  | $ | 316 |
Schedule of Reconciliation of Income Taxes on Earnings from Continuing Operations at Federal Statutory Income Tax Rate | Differences between the provision for (benefit from) income taxes and income taxes computed using the U.S. Federal statutory income tax rate follow:
| For years ended December 31,
(Dollars in millions) | 2018 |  | 2017 |  | 2016
Amount computed using the statutory rate | $ | 274 |  |  | $ | 450 |  |  | $ | 366 |
State income taxes, net | 6 |  |  | (4 | ) |  | (18 | )
Foreign rate variance | (52 | ) |  | (150 | ) |  | (121 | )
Domestic manufacturing deduction | — |  |  | (18 | ) |  | (7 | )
Change in reserves for tax contingencies | 21 |  |  | 20 |  |  | — |
General business credits | (60 | ) |  | (65 | ) |  | (20 | )
U.S. tax on foreign earnings | 8 |  |  | 29 |  |  | 25 |
Foreign tax credits | (12 | ) |  | (26 | ) |  | (10 | )
Tax law changes and tax loss from outside-U.S. entity reorganizations (1) | 20 |  |  | (339 | ) |  | — |
Other | 21 |  |  | 4 |  |  | (25 | )
Provision for (benefit from) income taxes | $ | 226 |  |  | $ | (99 | ) |  | $ | 190 |
Effective income tax rate | 17 | % |  | (8 | )% |  | 18 | %
Schedule of Significant Components of Deferred Tax Assets and Liabilities | The significant components of deferred tax assets and liabilities follow:
| December 31,
(Dollars in millions) | 2018 |  | 2017
Deferred tax assets |  |  |
Post-employment obligations | $ | 230 |  |  | $ | 242 |
Net operating loss carryforwards | 708 |  |  | 690 |
Tax credit carryforwards | 239 |  |  | 202 |
Environmental reserves | 70 |  |  | 72 |
Unrealized derivative loss | 18 |  |  | 17 |
Other | 94 |  |  | 90 |
Total deferred tax assets | 1,359 |  |  | 1,313 |
Less: Valuation allowance | 466 |  |  | 410 |
Deferred tax assets less valuation allowance | $ | 893 |  |  | $ | 903 |
Deferred tax liabilities |  |  |  |  |
Property, plant, and equipment | $ | (856 | ) |  | $ | (835 | )
Intangible assets | (473 | ) |  | (535 | )
Investments | (274 | ) |  | (274 | )
Other | (131 | ) |  | (131 | )
Total deferred tax liabilities | $ | (1,734 | ) |  | $ | (1,775 | )
Net deferred tax liabilities | $ | (841 | ) |  | $ | (872 | )
As recorded in the Consolidated Statements of Financial Position: |  |  |  |  |
Other noncurrent assets | $ | 43 |  |  | $ | 21 |
Deferred income tax liabilities | (884 | ) |  | (893 | )
Net deferred tax liabilities | $ | (841 | ) |  | $ | (872 | )
Schedule of Tax Receivables and Payables | Amounts due to and from tax authorities as recorded in the Consolidated Statements of Financial Position:
| December 31,
(Dollars in millions) | 2018 |  | 2017
Miscellaneous receivables | $ | 135 |  |  | $ | 215 |
Payables and other current liabilities | $ | 43 |  |  | $ | 58 |
Other long-term liabilities | 162 |  |  | 137 |
Total income taxes payable | $ | 205 |  |  | $ | 195 |
Schedule of Reconciliation of Beginning and Ending Amounts of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows:
(Dollars in millions) | 2018 |  | 2017 |  | 2016
Balance at January 1 | $ | 142 |  |  | $ | 114 |  |  | $ | 125 |
Adjustments based on tax positions related to current year | 44 |  |  | 29 |  |  | (7 | )
Lapse of statute of limitations | (4 | ) |  | (1 | ) |  | (4 | )
Balance at December 31 | $ | 182 |  |  | $ | 142 |  |  | $ | 114 |

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