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Income Taxes (Tables) | 12 Months Ended
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Dec. 31, 2020
Income Tax Disclosure [Abstract] |
Components of Income before Income Taxes | The components of Income (Loss) before Income Taxes follow:
(In millions) |  | 2020 |  |  | 2019 |  |  | 2018 |
U.S. |  | $ | (993 | ) |  | $ | (39 | ) |  | $ | 439 |
Foreign |  |  | (147 | ) |  |  | 216 |  |  |  | 572 |
|  | $ | (1,140 | ) |  | $ | 177 |  |  | $ | 1,011 |
Reconciliation of Income Taxes at the U.S. Statutory Rate to United States and Foreign Tax (Benefit) Expense | A reconciliation of income taxes at the U.S. statutory rate to United States and Foreign Tax Expense follows:
(In millions) |  | 2020 |  |  | 2019 |  |  | 2018 |
U.S. federal income tax expense (benefit) at the statutory rate of 21% |  | $ | (239 | ) |  | $ | 37 |  |  | $ | 212 |
Net establishment (release) of U.S. valuation allowances |  |  | 310 |  |  |  | (98 | ) |  |  | 25 |
Net foreign losses (income) with no tax due to valuation allowances |  |  | 37 |  |  |  | 48 |  |  |  | 7 |
Goodwill impairment |  |  | 34 |  |  |  | — |  |  |  | — |
Deferred tax impact of enacted tax rate and law changes |  |  | (18 | ) |  |  | 3 |  |  |  | — |
State income taxes, net of U.S. federal benefit |  |  | (17 | ) |  |  | (1 | ) |  |  | (1 | )
U.S. charges (benefits) related to foreign tax credits, R&D and foreign derived intangible deduction |  |  | (9 | ) |  |  | (17 | ) |  |  | 20 |
Adjustment for foreign income taxed at different rates |  |  | 7 |  |  |  | 16 |  |  |  | 30 |
Net establishment of uncertain tax positions |  |  | 6 |  |  |  | 7 |  |  |  | 18 |
Federal and state tax on accelerated royalty income transaction |  |  | — |  |  |  | 334 |  |  |  | — |
Net establishment (release) of foreign valuation allowances |  |  | — |  |  |  | 140 |  |  |  | (5 | )
Other |  |  | (1 | ) |  |  | 5 |  |  |  | (3 | )
United States and Foreign Tax Expense |  | $ | 110 |  |  | $ | 474 |  |  | $ | 303 |
Components of United States and Foreign Tax (Benefit) Expense | The components of United States and Foreign Tax Expense by taxing jurisdiction, follow:
(In millions) |  | 2020 |  |  | 2019 |  |  | 2018 |
Current: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | (5 | ) |  | $ | — |  |  | $ | (15 | )
Foreign |  |  | 95 |  |  |  | 134 |  |  |  | 188 |
State |  |  | (3 | ) |  |  | 17 |  |  |  | (1 | )
|  |  | 87 |  |  |  | 151 |  |  |  | 172 |
Deferred: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | 63 |  |  |  | 133 |  |  |  | 120 |
Foreign |  |  | (31 | ) |  |  | 153 |  |  |  | 6 |
State |  |  | (9 | ) |  |  | 37 |  |  |  | 5 |
|  |  | 23 |  |  |  | 323 |  |  |  | 131 |
United States and Foreign Tax Expense |  | $ | 110 |  |  | $ | 474 |  |  | $ | 303 |
Deferred Tax Assets and Liabilities | Temporary differences and carryforwards giving rise to deferred tax assets and liabilities at December 31 follow:
(In millions) |  | 2020 |  |  | 2019 |
Tax loss carryforwards and credits |  | $ | 1,570 |  |  | $ | 1,159 |
Prepaid royalty income |  |  | 629 |  |  |  | 576 |
Capitalized research and development expenditures |  |  | 421 |  |  |  | 416 |
Accrued expenses deductible as paid |  |  | 255 |  |  |  | 347 |
Postretirement benefits and pensions |  |  | 209 |  |  |  | 221 |
Lease liabilities |  |  | 76 |  |  |  | 75 |
Rationalizations and other provisions |  |  | 34 |  |  |  | 38 |
Vacation and sick pay |  |  | 21 |  |  |  | 23 |
Other |  |  | 133 |  |  |  | 106 |
|  |  | 3,348 |  |  |  | 2,961 |
Valuation allowance |  |  | (1,469 | ) |  |  | (982 | )
Total deferred tax assets |  |  | 1,879 |  |  |  | 1,979 |
Property basis differences |  |  | (420 | ) |  |  | (467 | )
Right-of-use assets |  |  | (75 | ) |  |  | (74 | )
Tax on undistributed earnings of subsidiaries |  |  | (1 | ) |  |  | (1 | )
Total net deferred tax assets |  | $ | 1,383 |  |  | $ | 1,437 |
Reconciliation of Unrecognized Tax Benefits | A summary of our unrecognized tax benefits and changes during the year follows:
(In millions) |  | 2020 |  |  | 2019 |  |  | 2018 |
Balance at January 1 |  | $ | 82 |  |  | $ | 71 |  |  | $ | 52 |
Increases related to prior year tax positions |  |  | 26 |  |  |  | 24 |  |  |  | 9 |
Decreases related to prior year tax positions |  |  | (1 | ) |  |  | — |  |  |  | (1 | )
Settlements |  |  | (15 | ) |  |  | (11 | ) |  |  | (2 | )
Foreign currency impact |  |  | (7 | ) |  |  | (2 | ) |  |  | (5 | )
Increases related to current year tax positions |  |  | — |  |  |  | — |  |  |  | 21 |
Lapse of statute of limitations |  |  | — |  |  |  | — |  |  |  | (3 | )
Balance at December 31 |  | $ | 85 |  |  | $ | 82 |  |  | $ | 71 |

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