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Income Taxes
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The components of the income tax provision are as follows:
Year Ended December 31,
(Dollars in millions)202320222021
Current expense:   
Federal$1,012 $784 $980 
State135 96 65 
Total current expense1,147 880 1,045 
Deferred expense:
Federal(390)316 245 
State(19)54 118 
Total deferred expense(409)370 363 
Provision for income taxes$738 $1,250 $1,408 

A reconciliation of the provision for income taxes at the statutory federal income tax rate to the Company’s actual provision for income taxes and effective tax rate is presented in the following table:
Year Ended December 31,
202320222021
(Dollars in millions)Amount% of Income Before TaxesAmount% of Income Before TaxesAmount% of Income Before Taxes
Federal income taxes at statutory rate$(161)21.0 %$1,476 21.0 %$1,550 21.0 %
Increase (decrease) in provision for income taxes as a result of:
State income taxes, net of federal tax benefit91 (11.9)118 1.7 145 2.0 
Non-deductible goodwill1,276 (166.8)— — — — 
Internal legal entity restructuring(191)25.0 — — — — 
Income tax credits, net of amortization(173)22.6 (233)(3.3)(195)(2.6)
Tax-exempt interest(157)20.5 (109)(1.6)(86)(1.2)
Other, net53 (6.9)(2)— (6)(0.1)
Provision for income taxes$738 (96.5)$1,250 17.8 $1,408 19.1 
Deferred income tax assets and liabilities result from differences between the timing of the recognition of assets and liabilities for financial reporting purposes and for income tax purposes. DTAs and DTLs are measured using the enacted federal and state tax rates in the periods in which the DTAs or DTLs are expected to be realized. In the Consolidated Balance Sheets, a net deferred income tax asset is recorded in Other assets and a net deferred income tax liability is recorded in Other liabilities. Significant DTAs and DTLs, net of the federal impact for state taxes, are presented in the following table:
December 31,
(Dollars in millions)
20232022
DTAs:  
Net unrealized losses in AOCI$3,860 $4,150 
ALLL1,132 1,022 
Employee compensation and benefits673 765 
Operating lease liability339 372 
Accruals and reserves330 207 
Federal and state NOLs and other carryforwards121 125 
Other314 190 
Total gross DTAs6,769 6,831 
Valuation allowance(105)(106)
Total DTAs net of valuation allowance6,664 6,725 
DTLs:
Pension1,884 1,532 
Goodwill and other intangible assets431 686 
Partnerships333 112 
Equipment and auto leasing309 422 
MSRs294 345 
ROU assets253 283 
Loans94 279 
Other29 39 
Total DTLs3,627 3,698 
Net DTA$3,037 $3,027 

The DTAs include state NOLs and other state carryforwards that will expire, if not utilized, in varying amounts from 2024 to 2043. The Company had a valuation allowance recorded against certain state NOL carryforward DTAs of $105 million and $106 million at December 31, 2023 and 2022, respectively.

The following table provides a rollforward of the Company’s gross federal and state UTBs, excluding interest and penalties:
(Dollars in millions)Dec 31, 2023Dec 31, 2022
Balance, January 1$97 $104 
Increases in UTBs related to prior years2 2 
Decreases in UTBs related to prior years(12)(2)
Increases in UTBs related to the current year10 9 
Decreases in UTBs related to settlements(2)(4)
Decreases in UTBs related to lapse of the applicable statutes of limitations(15)(12)
Balance, December 31$80 $97 

The amount of UTBs that would favorably affect the Company’s effective tax rate, if recognized, was $66 million and $80 million at December 31, 2023 and 2022, respectively. Interest and penalties related to UTBs are recorded in the Provision for income taxes in the Consolidated Statement of Income. The Company had a gross liability of $13 million and $11 million for interest and penalties related to its UTBs at December 31, 2023 and 2022, respectively. The amount of gross expense related to interest and penalties on UTBs was immaterial.

The Company files U.S. federal, state, and local income tax returns. The Company’s federal income tax returns are no longer subject to assessment by the IRS for taxable years prior to 2020. With limited exceptions, the Company is no longer subject to assessment by state and local taxing authorities for taxable years prior to 2018. It is reasonably possible that the liability for unrecognized tax benefits could decrease by as much as $34 million during the next 12 months due to completion of tax authority examinations and the expiration of statutes of limitations. It is uncertain how much, if any, of this potential decrease will impact the Company’s effective tax rate.