Income Taxes (Tables)

12 Months Ended

Jan. 28, 2017

Income Taxes [Abstract]

Domestic and International Pre-Tax Income

The domestic and international components of pre-tax income are as follows:

	2016		2015		2014
	($ in millions)
Domestic	$	779	$	668	$	654
International		225		169		155
Total pre-tax income	$	1,004	$	837	$	809

Income Tax Provision

The income tax provision consists of the following:

	2016		2015		2014
Current:	($ in millions)
Federal	$	249	$	212	$	195
State and local		44		37		34
International		48		53		40
Total current tax provision		341		302		269
Deferred:
Federal		(6)		(8)		16
State and local		1		(1)		3
International		4		3		1
Total deferred tax provision		(1)		(6)		20
Total income tax provision	$	340	$	296	$	289

Reconciliation of Significant Differences between Federal Statutory Income Tax Rate and Effective Income Tax Rate on Pre-Tax Income from Continuing Operations

A reconciliation of the significant differences between the federal statutory income tax rate and the effective income tax rate on pre-tax income is as follows:

	2016		2015		2014
Federal statutory income tax rate	35.0	%	35.0	%	35.0	%
State and local income taxes, net of federal tax benefit	3.1		2.8		3.2
International income taxed at varying rates	(3.7)		(2.1)		(1.9)
Foreign tax credits	(1.9)		(2.8)		(2.5)
Domestic/foreign tax settlements	(0.1)		(0.1)		(0.6)
Federal tax credits	(0.2)		(0.2)		(0.2)
Other, net	1.7		2.8		2.7
Effective income tax rate	33.9	%	35.4	%	35.7	%

Significant Portions of Deferred Tax Accounts

Items that give rise to significant portions of the Company’s deferred tax assets and deferred tax liabilities are as follows:

	2016		2015
Deferred tax assets:	($ in millions)
Tax loss/credit carryforwards and capital loss	$	12	$	8
Employee benefits		76		97
Property and equipment		110		121
Straight-line rent		51		39
Other		47		34
Total deferred tax assets	$	296	$	299
Valuation allowance		(7)		(5)
Total deferred tax assets, net	$	289	$	294
Deferred tax liabilities:
Merchandise inventories		104		104
Goodwill and other intangible assets		21		20
Other		6		6
Total deferred tax liabilities	$	131	$	130
Net deferred tax asset	$	158	$	164
Balance Sheet caption reported in:
Deferred taxes	$	161	$	234
Other current assets		—		5
Accrued and other current liabilities		—		(62)
Other liabilities		(3)		(13)
	$	158	$	164

Unrecognized Tax Benefits Activity

The following table summarizes the activity related to unrecognized tax benefits:

	2016		2015		2014
	($ in millions)
Unrecognized tax benefits at beginning of year	$	38	$	40	$	48
Foreign currency translation adjustments		1		(2)		(6)
Increases related to current year tax positions		8		4		3
Increases related to prior period tax positions		1		2		1
Decreases related to prior period tax positions		(2)		—		(1)
Settlements		(7)		(1)		(1)
Lapse of statute of limitations		(1)		(5)		(4)
Unrecognized tax benefits at end of year	$	38	$	38	$	40