Income Taxes (Tables)

9 Months Ended

Sep. 30, 2021

Reconciliation of income taxes at the statutory rate and income taxes shown in the Statement of Earnings

The following is a reconciliation of income taxes on continuing operations at the statutory rate of 21% to the provision for income taxes as shown in AFG’s Statement of Earnings (dollars in millions):


	Three months ended September 30,								Nine months ended September 30,
	2021				2020				2021				2020
	Amount		% of EBT		Amount		% of EBT		Amount		% of EBT		Amount		% of EBT
Earnings (loss) from continuing operations before income taxes (“EBT”)	$	267			$	40			$	890			$	(5)

Income taxes at statutory rate	$	56	21	%	$	8	21	%	$	187	21	%	$	(1)	21	%
Effect of:
Pending sale of Neon	—		—	%	(73)		(183	%)	—		—	%	(73)		1,460	%
Stock-based compensation	(2)		(1	%)	—		—	%	(12)		(1	%)	(3)		60	%
Employee stock ownership plan dividend paid deduction	(2)		(1	%)	(1)		(3	%)	(10)		(1	%)	(1)		20	%
Tax exempt interest	(2)		(1	%)	(2)		(5	%)	(6)		(1	%)	(7)		140	%
Dividends received deduction	—		—	%	(1)		(3	%)	(1)		—	%	(2)		40	%
Foreign operations	2		1	%	(4)		(10	%)	—		—	%	(3)		60	%
Adjustment to prior year taxes	(1)		—	%	1		3	%	(1)		—	%	1		(20	%)
Nondeductible expenses	2		1	%	1		3	%	6		1	%	3		(60	%)
Change in valuation allowance	(2)		(1	%)	20		50	%	1		—	%	31		(620	%)

Other	(3)		(1	%)	3		7	%	—		(1	%)	3		(61	%)
Provision (credit) for income taxes as shown in the statement of earnings	$	48	18	%	$	(48)	(120	%)	$	164	18	%	$	(52)	1,040	%