(10) Income Taxes

The reconciliation of the federal statutory tax rate to the effective income tax rate was as follows for the periods indicated:


	Three months ended September 30,										Nine months ended September 30,
(Amounts in millions)	2015					2014					2015					2014
Pre-tax income (loss)	$	(351	)			$	(980	)			$	188				$	(375	)

Statutory U.S. federal income tax rate	$	(123	)	35.0	%	$	(343	)	35.0	%	$	66		35.0	%	$	(131	)	35.0	%
Increase (reduction) in rate resulting from:
State income tax, net of federal income tax effect		(1	)	0.4			(3	)	0.3			3		1.4			3		(0.8	)
Benefit on tax favored investments		(9	)	2.5			(1	)	0.1			(14	)	(7.2	)		(3	)	0.8
Effect of foreign operations		(3	)	0.8			(5	)	0.5			(33	)	(17.5	)		(46	)	12.3
Non-deductible expenses		—		—			—		—			1		0.6			1		(0.3	)
Interest on uncertain tax positions		—		(0.2	)		—		—			1		0.3			—		—
Valuation allowance		—		—			—		—			—		—			(7	)	1.8
Non-deductible goodwill		—		0.1			163		(16.6	)		—		—			163		(43.4	)
Stock-based compensation		2		(0.5	)		—		—			4		2.0			8		(2.1	)
Other, net		—		—			2		(0.2	)		(1	)	(0.3	)		(4	)	1.0

Effective rate	$	(134	)	38.1	%	$	(187	)	19.1	%	$	27		14.3	%	$	(16	)	4.3	%

For the three months ended September 30, 2015, the increase in the effective tax rate was primarily attributable to non-deductible goodwill impairments in the prior year and decreased benefits from lower taxed foreign income in the current year, partially offset by increased benefits from tax favored investments and true ups related to lower taxed foreign income.

For the nine months ended September 30, 2015, the increase in the effective tax rate was primarily attributable to non-deductible goodwill impairments in the prior year and decreased benefits from lower taxed foreign income, partially offset by prior year true ups related to lower taxed foreign income and increased benefits from tax favored investments.