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Note 10 - Income Taxes
 3 Months Ended
Mar. 31, 2023
Notes to Financial Statements  
Income Tax Disclosure [Text Block]

NOTE 10: INCOME TAXES

 

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

 

  

Three Months Ended

 
  

March 31,

 

(in millions)

 

2023

  

2022

 

Earnings (loss) from operations before income taxes

 $41  $(1)

Effective tax rate

  19.5%  (200.0)%

Provision for income taxes

  8   2 

Provision for income taxes at U.S. statutory tax rate

  9   0 

Difference between tax at effective vs. statutory rate

 $(1) $2 

 

For the three months ended March 31, 2023, the difference between Kodak’s effective tax rate and the U.S. statutory rate of 21.0% is primarily attributable to: (1) the impact related to existing valuation allowances associated with changes in net deferred tax assets from current earnings and losses, (2) the results from operations in jurisdictions outside the U.S., and (3) a provision associated with foreign withholding taxes on undistributed earnings.

 

For the three months ended March 31, 2022, the difference between Kodak’s effective tax rate and the U.S. statutory rate of 21.0% is primarily attributable to: (1) the impact related to existing valuation allowances associated with changes in net deferred tax assets from current earnings and losses, (2) the results from operations in jurisdictions outside the U.S., (3) a benefit associated with foreign withholding taxes on undistributed earnings and (4) a settlement with a taxing authority in a location outside the U.S.

 

During the quarter ended March 31, 2022, Kodak agreed to terms with a taxing authority outside the U.S. and settled open tax audits for years 2015 through 2018. This settlement included a cash payment of $2 million which is reflected in the provision for taxes in the prior year-to-date period, and a decrease in net deferred tax assets of $3 million which was fully offset by a corresponding change in the valuation allowance.