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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Schedule of Income before Income Tax, Domestic and Foreign [Table Text Block]

The components of income from continuing operations before provision for income taxes are as follows:


(In millions)	2019		2018		2017

U.S.	$	2,278	$	1,329	$	655
Non-U.S.	1,792		1,933		1,774

Income from Continuing Operations	$	4,070	$	3,262	$	2,429

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]

The components of the provision for income taxes of continuing operations are as follows:


(In millions)	2019		2018		2017

Current Income Tax Provision
Federal	$	267	$	165	$	1,259
Non-U.S.	544		574		576
State	62		59		62

	873		798		1,897

Deferred Income Tax Provision (Benefit)
Federal	$	(222)	$	(258)	$	(1,437)
Non-U.S.	(252)		(187)		(271)
State	(25)		(29)		12

	(499)		(474)		(1,696)

Provision for Income Taxes	$	374	$	324	$	201

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

The provision for income taxes in the accompanying statement of income differs from the provision calculated by applying the statutory federal income tax rate to income from continuing operations before provision for income taxes due to the following:


(In millions)	2019			2018			2017

Statutory Federal Income Tax Rate	21		%	21		%	35		%

Provision for Income Taxes at Statutory Rate	$	855		$	685		$	850

Increases (Decreases) Resulting From:
Foreign rate differential	(204)			(375)			(380)
Foreign exchange loss on inter-company debt refinancing	(62)			—			(237)
Income tax credits	(379)			(349)			(273)

Withholding taxes	38			31			55
Global intangible low-taxed income	258			167			—
Foreign-derived intangible income	(111)			(47)			—

Impact of change in tax laws and apportionment on deferred taxes	6			(12)			(1,121)
Transition tax and other impacts of U.S. tax reform	8			117			1,250

Provision for (reversal of) tax reserves, net	62			(49)			99
Excess tax benefits from stock options and restricted stock units	(80)			(77)			(65)
Basis difference on disposal of business	73			—			—

Valuation allowance	(4)			260			7

Intra-entity transfers	(79)			—			—
Other, net	(7)			(27)			16

Provision for Income Taxes	$	374		$	324		$	201

Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

Net deferred tax asset (liability) in the accompanying balance sheet consists of the following:


(In millions)	2019		2018

Deferred Tax Asset (Liability)
Depreciation and amortization	$	(3,084)	$	(3,444)
Net operating loss and credit carryforwards	1,231		1,311
Reserves and accruals	144		148
Accrued compensation	261		250
Inventory basis difference	99		105
Other capitalized costs	71		103
Unrealized losses on hedging instruments	10		23
Other, net	57		143

Deferred tax assets (liabilities), net before valuation allowance	(1,211)		(1,361)
Less: Valuation allowance	408		471

Deferred tax assets (liabilities), net	$	(1,619)	$	(1,832)

The company estimates the degree to which tax assets and loss and credit carryforwards will result in a benefit based on expected profitability by tax jurisdiction and provides a valuation allowance for tax assets and loss and credit carryforwards that it believes will more likely than not expire unutilized. At December 31, 2019, all of the company’s valuation allowance relates to deferred tax assets, primarily net operating losses, for which any subsequently recognized tax benefits will reduce income tax expense.

The changes in the valuation allowance are as follows:


	Year Ended December 31,
(In millions)	2019		2018		2017

Beginning Balance	$	471	$	256	$	113
(Reductions) additions charged to income tax provision, net	(27)		223		28
Additions due to acquisitions	—		17		108
Reduction due to a divestiture	(33)		—		—
Deductions	—		(15)		—
Currency translation and other	(3)		(10)		7

Ending Balance	$	408	$	471	$	256

Summary of Income Tax Contingencies [Table Text Block]

A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows:


(In millions)	2019		2018		2017

Beginning Balance	$	1,442	$	1,409	$	802
Additions due to acquisitions	—		—		31
Reductions due to acquisitions	—		(5)		—
Additions for tax positions of current year	53		48		565
Additions for tax positions of prior years	69		82		51
Reductions for tax positions of prior years	(7)		—		—
Closure of tax years	—		(5)		—
Settlements	(5)		(87)		(40)

Ending Balance	$	1,552	$	1,442	$	1,409