Income Taxes

9 Months Ended

Oct. 02, 2021

Income Tax Disclosure [Abstract]

Income Taxes [Text Block]

Note 5.    Income Taxes

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 before provision for income taxes due to the following:

	Nine Months Ended
	October 2,			September 26,
(In millions)	2021			2020
Statutory Federal Income Tax Rate	21		%	21		%
Provision for Income Taxes at Statutory Rate	$	1,464		$	910
Increases (Decreases) Resulting From:
Foreign rate differential	(159)			(132)
Income tax credits	(205)			(205)
Global intangible low-taxed income	45			82
Foreign-derived intangible income	(114)			(53)
Excess tax benefits from stock options and restricted stock units	(96)			(94)
Intra-entity transfers	(258)			—
Withholding taxes	106			10
State income taxes, net of federal tax	115			29
Other, net	8			(91)
Provision for Income Taxes	$	906		$	456

The company has operations and a taxable presence in approximately 50 countries outside the U.S. The company's effective income tax rate differs from the U.S. federal statutory rate each year due to certain operations that are subject to tax incentives, state and local taxes, and foreign taxes that are different than the U.S. federal statutory rate.

Unrecognized Tax Benefits

As of October 2, 2021, the company had $1.12 billion of unrecognized tax benefits substantially all of which, if recognized, would reduce the effective tax rate.

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

(In millions)	2021
Balance at Beginning of Year	$	1,091
Additions for tax positions of current year	30
Additions for tax positions of prior years	15
Reductions for tax positions of prior years	(2)
Settlements	(16)
Balance at End of Period	$	1,118