INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2016

Years Ended December 31,
(in millions)		2016		2015		2014
Foreign and U.S. components of actual income tax expense:
Foreign:
Current	$	436	$	391	$	473
Deferred		(121)		(95)		154
U.S.:
Current		140		429		115
Deferred		(270)		334		2,185
Total	$	185	$	1,059	$	2,927

	2016						2015							2014
		Pre-Tax		Tax	Percent of			Pre-Tax		Tax		Percent of					Tax	Percent of
Years Ended December 31,		Income		Expense/	Pre-Tax			Income		Expense/		Pre-Tax			Pre-Tax		Expense/	Pre-Tax
(dollars in millions)		(Loss)		(Benefit)	Income (Loss)			(Loss)		(Benefit)	Income (Loss)				Income		(Benefit)	Income
U.S. federal income tax at statutory rate	$	(159)	$	(56)	35.0	%	$	3,281	$	1,148		35.0	%	$	10,524	$	3,683	35.0	%
Adjustments:
Tax exempt interest				(178)	111.9					(195)		(5.9)					(236)	(2.2)
Uncertain tax positions				268	(168.6)					195		5.9					(81)	(0.8)
Reclassifications from accumulated
other comprehensive income				(132)	83.0					(127)		(3.9)					(61)	(0.6)
Dispositions of Subsidiaries				118	(74.2)					-		-					-	-
Tax Attribute Restoration				(164)	103.1					-		-					(182)	(1.7)
Non-controlling Interest				(81)	50.9					-		-					-	-
Non-deductible transfer pricing
charges				102	(64.2)					97		3.0					86	0.8
Dividends received deduction				(75)	47.2					(72)		(2.2)					(62)	(0.6)
Effect of foreign operations				234	(147.2)					(58)		(1.8)					(68)	(0.6)
State income taxes				23	(14.5)					34		1.0					39	0.4
Other				13	(8.2)					(73)		(2.2)					(2)	-
Effect of discontinued operations				35	(22.0)					-		-					65	0.6
Valuation allowance:
Continuing operations				83	(52.2)					110		3.4					(181)	(1.7)
Consolidated total amounts		(159)		190	(119.5)			3,281		1,059		32.3			10,524		3,000	28.5
Amounts attributable to discontinued
operations		(85)		5	(5.9)			-		-		-			23		73	317.4
Amounts attributable to continuing
operations	$	(74)	$	185	(250.0)	%	$	3,281	$	1,059		32.3	%	$	10,501	$	2,927	27.9	%

December 31,
(in millions)		2016		2015
Deferred tax assets:
Losses and tax credit carryforwards	$	16,448	$	18,680
Basis differences on investments		4,985		4,886
Life policy reserves		3,040		353
Accruals not currently deductible, and other		1,128		1,003
Investments in foreign subsidiaries		103		-
Loss reserve discount		1,151		1,021
Loan loss and other reserves		39		8
Unearned premium reserve reduction		924		1,603
Flight equipment, fixed assets and intangible assets		478		129
Other		710		577
Employee benefits		1,171		1,286
Total deferred tax assets		30,177		29,546
Deferred tax liabilities:
Investments in foreign subsidiaries		-		(33)
Deferred policy acquisition costs		(3,790)		(3,467)
Unrealized gains related to available for sale debt securities		(2,844)		(3,077)
Total deferred tax liabilities		(6,634)		(6,577)
Net deferred tax assets before valuation allowance		23,543		22,969
Valuation allowance		(2,831)		(3,012)
Net deferred tax assets (liabilities)	$	20,712	$	19,957

December 31, 2016				Tax	Expiration
(in millions)		Gross		Effected	Periods
Net operating loss carryforwards	$	34,618	$	12,116	2028 - 2035
Foreign tax credit carryforwards				4,917	2018 - 2023
Other carryforwards				737	Various
Total AIG U.S. consolidated income tax group tax losses and credits
carryforwards on a tax return basis				17,770
Unrecognized tax benefit				(2,903)
Total AIG U.S. consolidated income tax group tax losses and credits
carryforwards on a U.S. GAAP basis^*			$	14,867

* Includes other carryforwards, e.g. general business credits, of $96 million on a U.S. GAAP basis.

December 31, 2016				Tax	Expiration
(in millions)		Gross		Effected	Periods
Net operating loss carryforwards	$	34,618	$	12,116	2028 - 2035
Foreign tax credit carryforwards				4,917	2018 - 2023
Other carryforwards				737	Various
Total AIG U.S. consolidated income tax group tax losses and credits
carryforwards on a tax return basis				17,770
Unrecognized tax benefit				(2,903)
Total AIG U.S. consolidated income tax group tax losses and credits
carryforwards on a U.S. GAAP basis^*			$	14,867

* Includes other carryforwards, e.g. general business credits, of $96 million on a U.S. GAAP basis.

December 31,
(in millions)		2016		2015
Net U.S. consolidated return group deferred tax assets	$	24,134	$	24,134
Net deferred tax assets (liabilities) in accumulated other comprehensive income		(2,384)		(2,806)
Valuation allowance		(874)		(1,281)
Subtotal		20,876		20,047
Net foreign, state and local deferred tax assets		2,413		2,078
Valuation allowance		(1,957)		(1,731)
Subtotal		456		347
Subtotal - Net U.S., foreign, state and local deferred tax assets		21,332		20,394
Net foreign, state and local deferred tax liabilities		(620)		(437)
Total AIG net deferred tax assets (liabilities)	$	20,712	$	19,957

Years Ended December 31,
(in millions)		2016		2015		2014
Gross unrecognized tax benefits, beginning of year	$	4,331	$	4,395	$	4,340
Increases in tax positions for prior years		235		162		91
Decreases in tax positions for prior years		(39)		(209)		(60)
Increases in tax positions for current year		3		-		10
Lapse in statute of limitations		-		(4)		(6)
Settlements		-		(13)		-
Activity of discontinued operations		-		-		20
Gross unrecognized tax benefits, end of year	$	4,530	$	4,331	$	4,395