Income Taxes

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company is subject to U.S. federal, state, and foreign income taxes. Components of income before income taxes consist of the following:

	Year Ended December 31,
(In millions)	2021		2020		2019
United States	$	5,944.7	$	2,442.3	$	2,011.2
Foreign	3,381.1		1,368.1		417.9
	$	9,325.8	$	3,810.4	$	2,429.1

Components of income tax expense consist of the following:

	Year Ended December 31,
(In millions)	2021		2020		2019
Current:
Federal	$	1,429.8	$	199.0	$	444.6
State	6.2		1.2		1.9
Foreign	(38.4)		21.4		(2.6)
Total current tax expense	1,397.6		221.6		443.9
Deferred:
Federal	(423.2)		109.0		(132.0)
State	(0.6)		(2.0)		(1.7)
Foreign	276.7		(31.4)		3.1
Total deferred tax (benefit) expense	(147.1)		75.6		(130.6)
	$	1,250.5	$	297.2	$	313.3

A reconciliation of the U.S. statutory income tax rate to the Company's effective income tax rate is as follows:

	Year Ended December 31,
	2021		2020		2019
U.S. federal statutory tax rate	21.0	%	21.0	%	21.0	%
Taxation of non-U.S. operations	(2.8)		(1.8)		(1.0)
Stock-based compensation	(2.4)		(7.6)		(2.5)
Foreign-derived intangible income deduction	(1.4)		—		(1.6)
Income tax credits	(1.0)		(2.8)		(4.6)
Sale of non-inventory related assets between foreign subsidiaries	—		(0.8)		—
Other permanent differences	—		(0.2)		1.6
Effective income tax rate	13.4	%	7.8	%	12.9	%

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company's deferred tax assets and liabilities are as follows:

	As of December 31,
(In millions)	2021		2020
Deferred tax assets:
Deferred compensation	$	406.6	$	436.6
Accrued expenses	262.1		139.8
Fixed assets and intangible assets	257.5		140.5
Deferred revenue	57.3		44.6
Other	16.9		14.9
Total deferred tax assets	1,000.4		776.4
Deferred tax liabilities:
Unrealized gains on investments	(123.5)		(57.7)
Net deferred tax assets	$	876.9	$	718.7

The Company's federal income tax returns for 2017 through 2020 remain open to examination by the IRS. The Company's 2017 and 2018 federal income tax returns are currently under audit by the IRS. In general, the Company's state income tax returns from 2016 to 2020 remain open to examination. The Company's income tax returns outside of the United States remain open to examination from 2018 to 2020. The United States and many states generally have statutes of limitation ranging from 3 to 5 years; however, those statutes could be extended due to the Company's tax credit carryforward position. In general, tax authorities have the ability to review income tax returns in which the statute of limitation has previously expired to adjust the tax credits generated in those years.

The following table reconciles the beginning and ending amounts of unrecognized tax benefits. The amount of unrecognized tax benefits that, if settled, would impact the effective tax rate is $410.9 million, $267.0 million, and $210.8 million as of December 31, 2021, 2020, and 2019, respectively.

(In millions)	2021		2020		2019
Balance as of January 1	$	267.0	$	210.8	$	189.5
Gross increases related to current year tax positions	182.3		76.6		37.9
Gross increases (decreases) related to prior year tax positions	2.9		7.2		(7.2)
Gross decreases due to settlements and lapse of statutes of limitations	(41.3)		(27.6)		(9.4)
Balance as of December 31	$	410.9	$	267.0	$	210.8

During 2021, the decreases in unrecognized tax benefits related to the Company's federal income tax returns for 2015 and 2016, as these audits are closed. In 2021, 2020, and 2019, the increases in unrecognized tax benefits primarily related to the Company's calculation of certain tax credits and other items related to the Company's international operations.

During 2021, 2020, and 2019, interest expense related to unrecognized tax benefits recorded by the Company was not material. The Company does not believe that it is reasonably possible that the resolution of tax exposures within the next twelve months would have a material impact on its unrecognized tax benefits as of December 31, 2021.