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Income Taxes | 12 Months Ended
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Dec. 31, 2021
Income Tax Disclosure [Abstract] |
Income Taxes | 15. Income Taxes The domestic and foreign components of income (loss) before income taxes were as follows (in millions):
|  | Years Ended December 31, |
|  | 2021 |  |  | 2020 |  |  | 2019 |
Domestic |  | $ | (257 | ) |  | $ | (2,169 | ) |  | $ | (4,501 | )
Foreign |  |  | 27 |  |  |  | (610 | ) |  |  | (1,961 | )
|  | $ | (230 | ) |  | $ | (2,779 | ) |  | $ | (6,462 | )
The components of the provision for income taxes consisted of (in millions):
|  | Years Ended December 31, |
|  | 2021 |  |  | 2020 |  |  | 2019 |
Current: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 4 |  |  | $ | (279 | ) |  | $ | (7 | )
State |  |  | (1 | ) |  |  | (4 | ) |  |  | 4 |
Foreign |  |  | 23 |  |  |  | 106 |  |  |  | 60 |
Total current income tax provision |  |  | 26 |  |  |  | (177 | ) |  |  | 57 |
Deferred: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | (1 | ) |  |  | 7 |  |  |  | (344 | )
State |  |  | — |  |  |  | — |  |  |  | (18 | )
Foreign |  |  | (10 | ) |  |  | (72 | ) |  |  | (64 | )
Total deferred income tax provision |  |  | (11 | ) |  |  | (65 | ) |  |  | (426 | )
Total income tax provision |  | $ | 15 |  |  | $ | (242 | ) |  | $ | (369 | )
The difference between the effective tax rate reflected in the provision for income taxes and the U.S. federal statutory rate was as follows (in millions):
|  | Years Ended December 31, |
|  | 2021 |  |  | 2020 |  |  | 2019 |
Federal income tax at U.S. statutory rate |  | $ | (48 | ) |  | $ | (584 | ) |  | $ | (1,357 | )
Foreign income tax rate differential |  |  | (9 | ) |  |  | (30 | ) |  |  | (40 | )
Goodwill impairment |  |  | — |  |  |  | 271 |  |  |  | 666 |
Reduction of FTC carryforwards |  |  | — |  |  |  | 184 |  |  |  | — |
Tax Benefit from CARES Act |  |  | — |  |  |  | (83 | ) |  |  | — |
Change in deferred tax valuation allowance |  |  | 31 |  |  |  | (83 | ) |  |  | 218 |
Nondeductible expenses |  |  | 17 |  |  |  | 44 |  |  |  | 61 |
Foreign dividends, net of foreign tax credits |  |  | 54 |  |  |  | 28 |  |  |  | 163 |
Change in uncertain tax positions |  |  | 13 |  |  |  | 20 |  |  |  | (60 | )
State income taxes - net of federal benefit |  |  | (1 | ) |  |  | (4 | ) |  |  | (16 | )
Income tax credits |  |  | (11 | ) |  |  | — |  |  |  | — |
Other |  |  | (31 | ) |  |  | (5 | ) |  |  | (4 | )
Total income tax provision |  | $ | 15 |  |  | $ | (242 | ) |  | $ | (369 | )
The effective tax rate for the year ended December 31, 2021 was (6.5%), compared to 8.7% for 2020. For the year-ended 2021, the effective tax rate was negatively impacted by current year losses in certain jurisdictions with no tax benefit, partially offset by favorable adjustments related to utilization of losses and tax credits for prior year tax returns. For the year ended December 31, 2020 the effective tax rate was negatively impacted by the impairment of nondeductible goodwill and the establishment of additional valuation allowances for current year losses and other tax attributes, partially offset by the release of valuation allowance as a result of (a) the carryback of $591 million of U.S. net operating losses from 2019 to 2014 as a result of the CARES Act and (b) the filing of an amended U.S. tax return to deduct foreign tax credits and carryback the resulting $287 million U.S. net operating loss from 2016 to 2014. Significant components of our deferred tax assets and liabilities were as follows (in millions):
|  | December 31, |
|  | 2021 |  |  | 2020 |
Deferred tax assets: |  |  |  |  |  |  |  |
Allowances and operating liabilities |  | $ | 297 |  |  | $ | 318 |
Net operating loss carryforwards |  |  | 446 |  |  |  | 387 |
Stock Compensation |  |  | 56 |  |  |  | 61 |
Tax credit carryforwards |  |  | 398 |  |  |  | 411 |
Other |  |  | 135 |  |  |  | 122 |
Valuation allowance |  |  | (1,127 | ) |  |  | (1,093 | )
Total deferred tax assets |  |  | 205 |  |  |  | 206 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Tax over book depreciation |  |  | 56 |  |  |  | 60 |
Capital leases |  |  | 76 |  |  |  | 80 |
Intangible assets |  |  | 52 |  |  |  | 49 |
Deferred income |  |  | 51 |  |  |  | 47 |
Accrued tax on unremitted earnings |  |  | 33 |  |  |  | 33 |
Other |  |  | 3 |  |  |  | 15 |
Total deferred tax liabilities |  |  | 271 |  |  |  | 284 |
Net deferred tax liability |  | $ | 66 |  |  | $ | 78 |
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in millions):
|  | 2021 |  |  | 2020 |  |  | 2019 |
Unrecognized tax benefit at beginning of year |  | $ | 57 |  |  | $ | 38 |  |  | $ | 98 |
Gross increase for tax positions in prior years |  |  | 8 |  |  |  | 25 |  |  |  | 10 |
Gross decrease for tax positions in prior years |  |  | (1 | ) |  |  | (2 | ) |  |  | (60 | )
Cash Settlements |  |  | (1 | ) |  |  | (1 | ) |  |  | (3 | )
Lapse of statute of limitations |  |  | (3 | ) |  |  | (3 | ) |  |  | (7 | )
Unrecognized tax benefit at end of year |  | $ | 60 |  |  | $ | 57 |  |  | $ | 38 |
The balance of unrecognized tax benefits at December 31, 2021, 2020 and 2019 was $60 million, $57 million and $38 million, respectively. Accruals related to prior year domestic and foreign jurisdiction issues resulted in uncertain tax position increases of $8 million in 2021. Resolutions of domestic and foreign jurisdiction audits resulted in a $1 million and $4 million decrease in uncertain tax provisions for the years ended December 31, 2021 and 2020, respectively. Substantially all of the unrecognized tax benefits, if ultimately realized, would be recorded as a benefit to the effective tax rate. The Company does not anticipate any material change within the next twelve months due to settlements and conclusions of tax examinations. To the extent penalties and interest would be assessed on any underpayment of income tax, such accrued amounts have been classified as a component of income tax expense in the financial statements consistent with the Company’s policy. For the years ended December 31, 2021, 2020 and 2019, we recorded income tax expense of $8 million, $2 million and nil, respectively, for interest and penalty related to unrecognized tax benefits. As of December 31, 202 1 and 20 20, the Company had accrued $20 million and $11 million, respectively, of interest and penalty relating to unrecognized tax benefits. The Company is subject to taxation in the United States as well as various states and foreign jurisdictions. The Company has significant operations in the United States, Norway, Saudi Arabia, Brazil, Canada, the United Kingdom, the Netherlands and Denmark. Tax years that remain subject to examination by major tax jurisdictions vary by legal entity, but are generally open in the U.S. for tax years ending after 2013 and outside the U.S. for tax years ending after 2016. Net operating loss carryforwards by jurisdiction and expiration as of December 31, 2021 were as follows (in millions):
|  | Federal |  |  | State |  |  | Foreign |  |  | Total |
2021 - 2025 Expiration |  | $ | 19 |  |  | $ | 4 |  |  | $ | 244 |  |  | $ | 267 |
2026 - 2040 Expiration |  |  | 31 |  |  |  | 383 |  |  |  | 381 |  |  |  | 795 |
Unlimited Expiration |  |  | 505 |  |  |  | — |  |  |  | 646 |  |  |  | 1,151 |
Total Net Operating Loss (NOL) |  | $ | 555 |  |  | $ | 387 |  |  | $ | 1,271 |  |  | $ | 2,213 |
Tax Effected NOL |  | $ | 117 |  |  | $ | 25 |  |  | $ | 304 |  |  | $ | 446 |
The Company has $387 million of excess foreign tax credits in the United States as of December 31, 2021, of which $128 million, $144 million, $96 million, $12 million, and $7 million will expire in 2022, 2027, 2028, 2030, and 2031 respectively. As of December 31, 2021, the Company has remaining tax-deductible goodwill of $93 million, resulting from acquisitions. The amortization of this goodwill is deductible over various periods ranging up to 10 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://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://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 http://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 http://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 http://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 http://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 http://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 http://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 http://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 http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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