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Income Taxes (Tables)
 12 Months Ended
Dec. 31, 2019
Income Tax Disclosure [Abstract]  
Components Of Earnings Before Income Taxes Between Domestic and Foreign Jurisdictions
The components of earnings before income taxes were:
Years ended December 31,
2019

 
2018

 
2017

U.S.

($2,792
)
 

$11,166

 

$9,660

Non-U.S.
533

 
438

 
447

Total

($2,259
)
 

$11,604

 

$10,107
Schedule Of Income Tax Expense/(Benefit)
Income tax (benefit)/expense consisted of the following:
Years ended December 31,
2019

 
2018

 
2017

Current tax (benefit)/expense
 
 
 
 
 
U.S. federal

($308
)
 

$1,873

 

$1,276

Non-U.S.
169

 
169

 
149

U.S. state
(161
)
 
97

 
23

Total current
(300
)
 
2,139

 
1,448

Deferred tax (benefit)/expense
 
 
 
 
 
U.S. federal
(953
)
 
(996
)
 
204

Non-U.S.
(3
)
 
(4
)
 
3

U.S. state
(367
)
 
5

 
(6
)
Total deferred
(1,323
)
 
(995
)
 
201

Total income tax (benefit)/expense

($1,623
)
 

$1,144

 

$1,649
Reconciliation Of U.S. Federal Statutory Tax Rate To Our Effective Income Tax Rate schedule
The following is a reconciliation of the U.S. federal statutory tax to actual income tax expense:
Years ended December 31,
2019
 
2018
 
2017
 
Amount
Rate
 
Amount
Rate
 
Amount
Rate
U.S. federal statutory tax

($474
)
21.0
 %
 

$2,437

21.0
 %
 

$3,537

35.0
 %
Research and development credits
(382
)
16.9

 
(207
)
(1.8
)
 
(162
)
(1.6
)
Audit settlements(1)
(371
)
16.4

 
(412
)
(3.6
)
 


Foreign derived intangible income(2)
(229
)
10.1

 
(549
)
(4.7
)
 




Excess tax benefits(3)
(180
)
8.0

 
(181
)
(1.6
)
 
(207
)
(2.1
)
Other provision adjustments
66

(3.0
)
 
91

1.0

 
26

0.3

Tax deductible dividends
(53
)
2.4

 
(48
)
(0.4
)
 
(68
)
(0.7
)
Tax on non-US activities
43

(1.9
)
 
40

0.3

 
(95
)
(0.9
)
State income tax provision, net of effects on U.S. federal tax
(43
)
1.9

 
84

0.7

 
17

0.2

Impact of Tax Cuts and Jobs Act(4)





 
(111
)
(1.0
)
 
(1,271
)
(12.6
)
U.S. manufacturing activity tax benefit




 




 
(128
)
(1.3
)
Income tax (benefit)/expense

($1,623
)
71.8
 %
 

$1,144

9.9
 %
 

$1,649

16.3
 %


(1) 
In the fourth quarter of 2019, we recorded a tax benefit of $371 related to the settlement of state tax audits spanning 15 tax years. In the third quarter of 2018, we recorded a tax benefit of $412 related to the settlement of the 2013-2014 federal tax audit.
(2) 
On December 22, 2017, the Tax Cuts and Jobs Act (TCJA) was enacted. The TCJA revised the U.S. corporate income tax by, among other things, lowering the rate from 35% to 21% effective January 1, 2018, implementing a territorial tax system and imposing a one-time tax on deemed repatriated earnings of non-U.S. subsidiaries. The TCJA also enacted provisions which effectively apply a lower U.S. tax rate to intangible income derived from serving non-U.S. markets. In 2019 and 2018, we recorded tax benefits related to foreign derived intangible income of $229 and $549.
(3) 
In 2019, 2018 and 2017, we recorded excess tax benefits related to employee share-based payments of $180, $181 and $207, respectively.
(4) 
In accordance with U.S. Securities and Exchange Commission Staff Accounting Bulletin No. 118 (SAB 118), in the fourth quarter of 2017, we recorded provisional tax benefits of $1,430 related to the remeasurement of our net U.S. deferred tax liabilities to reflect the reduction in the corporate tax rate and a provisional tax expense of $159 related to tax on non-U.S. activities resulting from the TCJA. During the fourth quarter of 2018 and in accordance with SAB 118, the Company completed its accounting for the provisional amounts recognized at December 31, 2017 and recorded an incremental benefit related to refinements to these provisional amounts which was not significant.
Significant Components Of Deferred Tax Assets Net Of Deferred Tax Liabilities
Significant components of our deferred tax assets/(liabilities) at December 31 were as follows:
 
2019

 
2018

Inventory and long-term contract methods of income recognition

($6,048
)
 

($5,422
)
Pension benefits
3,495

 
3,344

737 MAX customer concessions and other considerations
1,626

 


Fixed assets, intangibles and goodwill (net of valuation allowance of $16 and $16)

(1,560
)
 
(1,616
)
Retiree health care benefits
1,120

 
1,124

Other employee benefits
849

 
873

Accrued expenses and reserves

627

 
411

Net operating loss, credit and capital loss carryovers (net of valuation allowance of $102 and $77)(1)

595

 
258

Customer and commercial financing
(268
)
 
(309
)
Other
(166
)
 
(115
)
Net deferred tax assets/(liabilities)(2)

$270

 

($1,452
)

(1)  
Of the deferred tax asset for net operating loss and credit carryovers, $251 expires on or before December 31, 2039 and $344 may be carried over indefinitely.
(2)  
Included in the net deferred tax assets/(liabilities) as of December 31, 2019 and 2018 are deferred tax assets in the amounts of $4,589 and $4,275 related to Accumulated other comprehensive loss.
Net Deferred Tax Assets and Liabilities
Net deferred tax assets/(liabilities) at December 31 were as follows:

2019

 
2018

Deferred tax assets

$10,722

 

$8,835

Deferred tax liabilities
(10,334
)
 
(10,194
)
Valuation allowance
(118
)
 
(93
)
Net deferred tax assets/(liabilities)

$270

 

($1,452
)
Schedule Of Unrecognized Tax Benefits Roll Forward
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

2019

 
2018

 
2017

Unrecognized tax benefits – January 1

$2,412

 

$1,736

 

$1,557

Gross increases – tax positions in prior periods
100

 
87

 
3

Gross decreases – tax positions in prior periods
(1,418
)
 
(410
)
 
(44
)
Gross increases – current-period tax positions
344

 
1,208

 
220

Gross decreases - current period tax positions
(1
)
 
 
 
 
Settlements
39

 
(206
)
 


Statute Lapse


 
(3
)
 


Unrecognized tax benefits – December 31

$1,476

 

$2,412

 

$1,736