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Income Taxes
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Our income tax benefit consisted of the following for the years ended December 31 (in millions):
202220212020
Deferred:
Federal$(86)$(44)$(247)
State13 (44)(82)
Deferred income tax benefit(73)(88)(329)
Current:
Federal(3)3 (199)
State— 5 (9)
Foreign1 (1)(2)
Current income tax (benefit) expense(2)7 (210)
Total income tax benefit$(75)$(81)$(539)
On March 27, 2020, the CARES Act was enacted in response to the COVID-19 pandemic. The CARES Act permits net operating loss (NOL) carryovers and carrybacks to offset 100% of taxable income for taxable years beginning before 2021. In addition, the CARES Act allows NOLs incurred in 2018, 2019, and 2020 to be carried back to each of the five preceding taxable years to generate a refund of previously paid income taxes. As of December 31, 2022, the Company has filed its Application for Tentative Refund and is awaiting receipt of the refund.
Income tax benefit reconciles to the amount computed by applying the U.S. federal statutory income tax rate to loss before income taxes for the years ended December 31 as follows (in millions):
202220212020
Income tax benefit at statutory rate$(92)$(55)$(398)
State income tax, net of federal benefit13 (36)(71)
Nondeductible expenses8 5 5 
Net operating loss carryback— — (73)
Foreign tax credit re-characterization— — (13)
Foreign rate differential4 (5)2 
Valuation allowance(2)4 10 
Unrecognized tax benefit(3)7 (3)
Other, net(3)(1)2 
Total income tax benefit$(75)$(81)$(539)
The components of our deferred tax assets and liabilities as of December 31 are as follows (in millions):
20222021
Deferred tax assets:
Deferred revenue/gains$271 $301 
Employee benefits72 70 
Foreign tax credit78 83 
Other Credits4 4 
Net operating loss carryforward709 522 
Interest expense limitation carryforward29 — 
Operating lease liabilities194 189 
Rent expense84 108 
Transaction Costs13 — 
Sec. 174 research activities16 — 
Other20 17 
Total deferred tax assets1,490 1,294 
Valuation allowance(90)(73)
Deferred tax assets, net1,400 1,221 
Deferred tax liabilities:
Property and Equipment(1,963)(1,845)
Operating lease assets(173)(182)
Other(34)(37)
Total deferred tax liabilities(2,170)(2,064)
Net deferred tax liability$(770)$(843)
We have a U.S. foreign tax credit carryforward of $78 million which expires from 2023 to 2032.
In evaluating the realizability of the deferred tax assets, we assess whether it is more likely than not that some portion, or all, of the deferred tax assets, will be realized. We consider, among other things, the generation of future taxable income (including reversals of deferred tax liabilities) during the periods in which the related temporary differences will become deductible. At December 31, 2022, we provided a $90 million valuation allowance to reduce the deferred tax assets to an amount that we consider is more likely than not to be realized. Of the total valuation allowance, $82 million relates to foreign NOL carryforward, and $8 million relates to U.S. foreign tax credit carryforward that begins to expire in 2022.
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in millions):
202220212020
Unrecognized tax benefits at January 1,$40 $32 $36 
Increases for tax positions taken during the period5 2 1 
Decreases for tax positions taken during the period(6)(1)— 
Increases for tax positions taken during a prior period— 19 — 
Decreases for tax positions taken during a prior period(13)(12)(5)
Unrecognized tax benefits December 31,$26 $40 $32 
Interest and penalties accrued on unrecognized tax benefits were not significant. If recognized, $8 million of the unrecognized tax benefits as of December 31, 2022 would impact our effective tax rate. We do not expect any significant change in the amount of the unrecognized tax benefits within the next twelve months. As a result of net operating losses and statute of limitations in our major tax jurisdictions, years 2016 through 2020 remain subject to examination by the relevant tax authorities.