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INCOME TAXES (Tables)
12 Months Ended
Dec. 31, 2018
INCOME TAXES  
Schedule of income (loss) from continuing operations before income tax expense (benefit) by U.S. and foreign location
Years Ended December 31,
(in millions)201820172016
U.S.$(12)$1,940$1,041
Foreign269(474)(1,115)
Total$257$1,466$(74)
Schedule of income tax expense (benefit) attributable to pre-tax income (loss) from continuing operations
Years Ended December 31,
(in millions)201820172016
Foreign and U.S. components of actual income tax expense:
U.S.:
Current$134$427$140
Deferred(175)6,865(270)
Foreign:
Current202209436
Deferred(7)25(121)
Total$154$7,526$185
Schedule of reconciliation between actual income tax (benefit) expense and statutory U.S. federal amount computed by applying the federal income tax rate
201820172016
Pre-TaxTaxPercent ofPre-TaxTaxPercent ofTaxPercent of
Years Ended December 31,IncomeExpense/Pre-TaxIncomeExpense/Pre-TaxPre-TaxExpense/Pre-Tax
(dollars in millions)(Loss)(Benefit)Income (Loss)(Loss)(Benefit)Income (Loss)Income(Benefit)Income
U.S. federal income tax at statutory
rate$255$5421.0%$1,476$51735.0%$(159)$(56)35.0%
Adjustments:
Tax exempt interest(37)(14.5)(111)(7.5)(178)111.9
Uncertain tax positions17669.066044.7268(168.6)
Reclassifications from accumulated
other comprehensive income(72)(28.2)(184)(12.5)(132)83.0
Dispositions of Subsidiaries--171.2118(74.2)
Tax Attribute Restoration----(164)103.1
Non-controlling Interest(1)(0.4)(7)(0.5)(81)50.9
Non-deductible transfer pricing
charges2911.4352.4102(64.2)
Dividends received deduction(38)(14.8)(90)(6.1)(75)47.2
Effect of foreign operations4417.3694.7234(147.2)
Share-based compensation
payments excess tax deduction(13)(5.1)(40)(2.7)--
State income taxes103.9(9)(0.6)23(14.5)
Impact of Tax Act6224.36,687453.0--
Global intangible low-taxed income218.2----
Other(102)(40.0)(58)(3.9)13(8.2)
Effect of discontinued operations4015.730.235(22.0)
Valuation allowance:
Continuing operations218.2432.983(52.2)
Consolidated total amounts25519476.01,4767,532510.3(159)190(119.5)
Amounts attributable to discontinued
operations(2)40NM10660.0(85)5(5.9)
Amounts attributable to continuing
operations$257$15459.9%$1,466$7,526513.4%$(74)$185(250.0)%
Schedule of components of the net deferred tax asset
December 31,
(in millions)20182017
Deferred tax assets:
Losses and tax credit carryforwards$11,792$11,931
Basis differences on investments2,0382,133
Life policy reserves2,2001,996
Accruals not currently deductible, and other608532
Investments in foreign subsidiaries173159
Loss reserve discount272526
Loan loss and other reserves-34
Unearned premium reserve reduction504566
Fixed assets and intangible assets531442
Other962731
Employee benefits604601
Total deferred tax assets19,68419,651
Deferred tax liabilities:
Deferred policy acquisition costs(2,342)(2,313)
Unrealized gains related to available for sale debt securities(490)(2,151)
Loan loss and other reserves(20)-
Total deferred tax liabilities(2,852)(4,464)
Net deferred tax assets before valuation allowance16,83215,187
Valuation allowance(1,780)(1,374)
Net deferred tax assets (liabilities)$15,052$13,813
Schedule of consolidated income tax group credits carryforwards
December 31, 2018TaxExpiration
(in millions)GrossEffectedPeriods
Net operating loss carryforwards$36,268$7,6162028 - 2037
Capital loss carryforwards82172023
Foreign tax credit carryforwards3,5162019 - 2023
Other carryforwards814Various
Total AIG U.S. consolidated income tax group tax losses and credits
carryforwards on a tax return basis11,963
Unrecognized tax benefit(1,733)
Total AIG U.S. consolidated income tax group tax losses and credits
carryforwards on a U.S. GAAP basis*$10,230

* Includes other carryforwards, i.e. general business credits of $30 million and refundable Alternative Minimum Tax Credits of $39 million on a U.S. GAAP basis.

Schedule of consolidated income tax group tax losses carryforwards
December 31, 2018TaxExpiration
(in millions)GrossEffectedPeriods
Net operating loss carryforwards$36,268$7,6162028 - 2037
Capital loss carryforwards82172023
Foreign tax credit carryforwards3,5162019 - 2023
Other carryforwards814Various
Total AIG U.S. consolidated income tax group tax losses and credits
carryforwards on a tax return basis11,963
Unrecognized tax benefit(1,733)
Total AIG U.S. consolidated income tax group tax losses and credits
carryforwards on a U.S. GAAP basis*$10,230

* Includes other carryforwards, i.e. general business credits of $30 million and refundable Alternative Minimum Tax Credits of $39 million on a U.S. GAAP basis.

Schedule of net deferred tax assets (liabilities)
December 31,
(in millions)20182017
Net U.S. consolidated return group deferred tax assets$15,479$15,603
Net deferred tax assets (liabilities) in accumulated other comprehensive income(510)(2,070)
Valuation allowance(405)(86)
Subtotal14,56413,447
Net foreign, state and local deferred tax assets2,0311,874
Valuation allowance(1,374)(1,288)
Subtotal657586
Subtotal - Net U.S., foreign, state and local deferred tax assets15,22114,033
Net foreign, state and local deferred tax liabilities(169)(220)
Total AIG net deferred tax assets (liabilities)$15,052$13,813
Schedule of reconciliation of the beginning and ending balances of the total amounts of gross unrecognized tax benefits
Years Ended December 31,
(in millions)201820172016
Gross unrecognized tax benefits, beginning of year$4,707$4,530$4,331
Increases in tax positions for prior years14210235
Decreases in tax positions for prior years(6)(33)(39)
Increases in tax positions for current year--3
Lapse in statute of limitations---
Settlements(6)--
Activity of discontinued operations---
Gross unrecognized tax benefits, end of year$4,709$4,707$4,530
Schedule of tax years that remain subject to examination by major tax jurisdictions
At December 31, 2018Open Tax Years
Major Tax Jurisdiction
United States2000-2017
Australia2014-2017
France2017-2018
Japan2012-2017
Korea2013-2017
Singapore2014-2017
United Kingdom2017-2018