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INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2020

Components of loss before benefit from income taxes

The components of Loss before benefit from income taxes for 2020, 2019 and 2018 consist of:


(in millions)	2020		2019		2018
Domestic	$	(410)	$	(2,396)	$	(1,475)
Foreign	(524)		559		(2,679)
	$	(934)	$	(1,837)	$	(4,154)

Components of benefit from income taxes

The components of Benefit from income taxes for 2020, 2019 and 2018 consist of:


(in millions)	2020		2019		2018
Current:
Domestic	$	(8)	$	(12)	$	—
Foreign	(216)		(116)		(327)
	(224)		(128)		(327)
Deferred:
Domestic	9		(5)		17
Foreign	590		187		320
	599		182		337
	$	375	$	54	$	10

Reconciliation of benefit from income taxes from the expected amount calculated by applying the Canadian statutory rate to loss before benefit of income taxes

The Benefit from income taxes differs from the expected amount calculated by applying the Company’s Canadian statutory rate of 26.9% to Loss before benefit from income taxes for 2020, 2019 and 2018 as follows:


(in millions)	2020		2019		2018
Loss before benefit from income taxes	$	(934)	$	(1,837)	$	(4,154)
Benefit from income taxes
Expected benefit from income taxes at Canadian statutory rate	$	251	$	494	$	1,117
Non-deductible amount of share-based compensation	(9)		(7)		(10)
Adjustments to tax attributes	26		(99)		(4)
Change in valuation allowance related to foreign tax credits and NOLs	62		21		(3)
Change in valuation allowance on Canadian deferred tax assets and tax rate changes	687		(142)		(875)
Change in uncertain tax positions	(163)		(350)		(47)
Foreign tax rate differences	(128)		186		(3)
Non-deductible portion of Goodwill impairments	—		—		(488)
Tax benefit on intra-entity transfers	(338)		—		356
Other	(13)		(49)		(33)
	$	375	$	54	$	10

Schedule of tax effect of major items recorded as deferred tax assets and liabilities and valuation allowance

Deferred tax assets and liabilities as of December 31, 2020 and 2019 consist of:


(in millions)	2020		2019
Deferred tax assets:
Tax loss carryforwards	$	2,924	$	2,911
Provisions	1,004		641
Research and development tax credits	172		155
Scientific Research and Experimental Development pool	55		52
Tax credit carryforwards	20		25
Deferred revenue	9		5
Unrealized FX on U.S. dollar debt and other financing cost	—		94
Prepaid expenses	27		41
Share-based compensation	16		19
Other	24		23
Total deferred tax assets	4,251		3,966
Less valuation allowance	(2,252)		(2,831)
Net deferred tax assets	1,999		1,135
Deferred tax liabilities:
Intangible assets	228		53
Plant, equipment and technology	89		56
Outside basis differences	71		41
Unrealized FX on U.S. dollar debt and other financing cost	2		—
Total deferred tax liabilities	390		150
Net deferred tax asset	$	1,609	$	985

The following table presents a reconciliation of the deferred tax asset valuation allowance for 2020, 2019 and 2018:


(in millions)	2020		2019		2018
Balance, beginning of year	$	2,831	$	2,913	$	2,001
Charged to Benefit from income taxes	(773)		13		870
Charged to other accounts	194		(95)		42
Balance, end of year	$	2,252	$	2,831	$	2,913

Summary of open tax years by jurisdiction


Jurisdiction:						Open Years
United States - Federal						2015 - 2019
Canada						2005 - 2019
Germany						2014 - 2019
France						2013 - 2019
China						2016 - 2019
Ireland						2016 - 2019
Netherlands						2016 - 2019
Australia						2011 - 2019

Reconciliation of the beginning and ending amounts of unrecognized tax benefits

The following table presents a reconciliation of the unrecognized tax benefits for 2020, 2019 and 2018:


(in millions)	2020		2019		2018
Balance, beginning of year	$	1,002	$	654	$	598
Additions based on tax positions related to the current year	66		361		18
Additions for tax positions of prior years	171		63		55
Reductions for tax positions of prior years	(209)		(58)		(11)
Lapse of statute of limitations	(5)		(18)		(6)
Balance, end of year	$	1,025	$	1,002	$	654