Income Taxes |
9 Months Ended |
|---|---|
Sep. 30, 2024 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | Note 7 — Income Taxes Benefit from income taxes for the three and nine months ended September 30, 2024 was $322 million and $248 million, respectively, compared to a provision for income taxes of $25 million and $99 million for the three and nine months ended September 30, 2023, respectively. The effective tax rates were 16.1% and 15.6% for the three and nine months ended September 30, 2024, respectively, and 15.5% and 18.3% for the three and nine months ended September 30, 2023, respectively. These effective tax rates are calculated using extended values from our condensed consolidated statements of comprehensive income and are therefore more precise tax rates than can be calculated from rounded values. The prior-year effective tax rate for the three months ended September 30, 2023 was lower due to the tax-exempt gain on a business disposal. The current-year effective tax rate for the nine months ended September 30, 2024 was lower due to deferred tax benefits recognized on the gross-up to carrying value of net assets to be disposed and a deferred tax benefit of $56 million, net of a $37 million valuation allowance, on the expected tax loss on disposal of TRANZACT (see Note 3 – Acquisitions and Divestitures). The Company records valuation allowances against net deferred tax assets based on whether it is more likely than not that the deferred tax assets will be realized. During the three months ended September 30, 2024 the Company recorded a $37 million valuation allowance related to unrealized capital losses that are not more-likely-than-not to be realized. The Company recognizes deferred tax balances related to the undistributed earnings of subsidiaries when it expects that it will recover those undistributed earnings in a taxable manner, such as through receipt of dividends or sale of the investments. Historically, the Company has not provided taxes on cumulative earnings of its subsidiaries that have been reinvested indefinitely. As a result of its plans to restructure or distribute accumulated earnings of certain foreign operations, the Company has recorded an estimate of non-U.S. withholding and state income taxes. However, the Company asserts that the historical cumulative earnings of its other subsidiaries are reinvested indefinitely and therefore does not provide deferred tax liabilities on these amounts. The Company records valuation allowances against net deferred tax assets based on whether it is more likely than not that the deferred tax assets will be realized. We have liabilities for uncertain tax positions under ASC 740, Income Taxes of $50 million, excluding interest and penalties. The Company believes the outcomes that are reasonably possible within the next 12 months may result in a reduction in the liability for uncertain tax positions of approximately $1 million to $3 million, excluding interest and penalties. |