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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2012

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]

Our income tax (provision) benefit consisted of the following:



	Year Ended December 31,
(in millions)	2012			2011			2010
Current tax benefit (provision)	$	1		$	83		$	(7	)
Deferred tax provision	(449		)	(349		)	(265		)
Decrease in valuation allowance	432			351			257
Income tax (provision) benefit	$	(16	)	$	85		$	(15	)

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

The following table presents the principal reasons for the difference between the effective tax rate and the U.S. federal statutory income tax rate:



	Year Ended December 31,
	2012		2011		2010
U.S. federal statutory income tax rate	35.0	%	35.0	%	35.0	%
State taxes	3.3		3.4		2.3
Decrease in valuation allowance	(40.8	)	(45.7	)	(42.3	)
Release of uncertain tax position reserve	—		(9.0	)	—
Other	4.0		5.3		7.6
Effective income tax rate	1.5	%	(11.0	)%	2.6	%

Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

The following table shows significant components of our deferred tax assets and liabilities:



	December 31,
(in millions)	2012			2011
Deferred tax assets:
Net operating loss carryforwards	$	6,414		$	6,647
Pension, postretirement and other benefits	6,415			5,703
AMT credit carryforward	402			402
Deferred revenue	2,133			2,297
Rent expense	233			284
Reorganization items, net	209			395
Other	439			564
Valuation allowance	(10,963		)	(10,705		)
Total deferred tax assets	$	5,282		$	5,587
Deferred tax liabilities:
Depreciation	$	4,851		$	5,093
Debt valuation	162			206
Intangible assets	1,730			1,755
Fuel hedge derivatives	31			32
Other	92			68
Total deferred tax liabilities	$	6,866		$	7,154

The following table shows the current and noncurrent deferred tax assets (liabilities):



	December 31,
(in millions)	2012			2011
Current deferred tax assets, net	$	463		$	461
Noncurrent deferred tax liabilities, net	(2,047		)	(2,028		)
Total deferred tax liabilities, net	$	(1,584	)	$	(1,567	)

Summary of Income Tax Contingencies [Table Text Block]

The following table shows the amount of and changes to unrecognized tax benefits on our Consolidated Balance Sheets:



(in millions)	2012			2011			2010
Unrecognized tax benefits at beginning of period	$	22		$	89		$	66
Gross increases-tax positions in prior period	31			1			—
Gross increases-tax positions in current period	2			1			29
Settlements	(2		)	(65		)	(1		)
Other	(9		)	(4		)	(5		)
Unrecognized tax benefits at end of period⁽¹⁾	$	44		$	22		$	89


⁽¹⁾	Unrecognized tax benefits on our Consolidated Balance Sheets as of December 31, 2012, 2011 and 2010, include tax benefits of $12 million, $5 million and $72 million, respectively, which will affect the effective tax rate when recognized.

Summary of Valuation Allowance [Table Text Block]

The following table shows the balance of our valuation allowance and the associated activity:



(in millions)	2012			2011			2010
Valuation allowance at beginning of period	$	10,705		$	9,632		$	9,897
Income tax provision	(432		)	(351		)	(257		)
Other comprehensive income tax benefit	690			1,241			6
Other	—			183			(14		)
Valuation allowance at end of period⁽¹⁾	$	10,963		$	10,705		$	9,632


⁽¹⁾	At December 31, 2012, 2011 and 2010, $3.1 billion, $2.5 billion and $1.2 billion of these balances were recorded in AOCI on our Consolidated Balance Sheets, respectively.

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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- Definition

Tabular disclosure of valuation allowances to reduce deferred tax assets to net realizable value, including identification of the deferred tax asset more likely than not will not be fully realized and the corresponding amount of the valuation allowance.

+ References+ Details