Income Taxes

6 Months Ended

Jun. 30, 2022

Income Tax Disclosure [Abstract]

Income Taxes

Note 12    Income Taxes

The components of income tax expense were:

	Three Months Ended June 30					Six Months Ended June 30
(Dollars in Millions)	2022			2021		2022		2021
Federal
Current	$	221		$	350	$	625	$	703
Deferred		107			76		5		206
Federal income tax		328			426		630		909
State
Current		89			109		178		203
Deferred		(3	)		16		3		46
State income tax		86			125		181		249
Total income tax provision	$	414		$	551	$	811	$	1,158

A reconciliation of expected income tax expense at the federal statutory rate of 21 percent to the Company’s applicable income tax expense follows:

	Three Months Ended June 30						Six Months Ended June 30
(Dollars in Millions)	2022			2021			2022			2021
Tax at statutory rate	$	409		$	533		$	820		$	1,140
State income tax, at statutory rates, net of federal tax benefit		84			105			168			219
Tax effect of
Tax credits and benefits, net of related expenses		(46	)		(83	)		(152	)		(176	)
Tax-exempt income		(29	)		(29	)		(57	)		(57	)
Other items		(4	)		25			32			32
Applicable income taxes	$	414		$	551		$	811		$	1,158

The Company’s income tax returns are subject to review and examination by federal, state, local and foreign government authorities. On an ongoing basis, numerous federal, state, local and foreign examinations are in progress and cover multiple tax years. As of June 30, 2022, federal tax examinations for all years ending through December 31, 2014 are completed and resolved. The Company’s tax returns for the years ended December 31, 2015 through December 31, 2020 are under examination by the Internal Revenue Service. The years open to examination by foreign, state and local government authorities vary by jurisdiction.

The Company’s net deferred tax asset was $3.6 billion at June 30, 2022 and $785 million at December 31, 2021.