Note 8 - Income Taxes

3 Months Ended

Mar. 31, 2014

NOTE 8: INCOME TAXES

Kodak’s income tax (benefit) provision and effective tax rate were as follows:

	Three Months Ended
	March 31,
	Successor			Predecessor
(in millions)	2014			2013
(Loss) earnings from continuing operations before income taxes	$	(60	)	$	331
Effective tax rate		11.7	%		2.1	%
(Benefit) provision for income taxes		(7	)		7
(Benefit) provision for income taxes @ 35%		(21	)		116
Difference between tax at effective vs. statutory rate	$	14		$	(109	)

For the three months ended March 31, 2014, the difference between the Company’s recorded benefit and the benefit that would result from applying the U.S. statutory rate of 35.0% is primarily attributable to: (1) losses generated within the U.S. and certain jurisdictions outside the U.S. for which no benefit was recognized due to management’s conclusion that it was more likely than not that the tax benefits would not be realized, (2) a benefit as a result of Kodak reaching a settlement with a taxing authority in a location outside the U.S. related to withholding taxes, and (3) a benefit associated with foreign withholding taxes on undistributed earnings.

For the three months ended March 31, 2013, the difference between the Company’s recorded provision and the provision that would result from applying the U.S. statutory rate of 35.0% is primarily attributable to: (1) income within the U.S. for which no provision was recognized offset by losses in certain jurisdictions outside the U.S. for which no benefit was recognized due to management’s conclusion that it was more likely than not that the tax benefits would not be realized, (2) a provision associated with withholding taxes on the sale of intellectual property, (3) a benefit associated with the tax impact of the goodwill impairment recognized during the quarter and (4) changes in audit reserves.

- 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.

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