AIG 2011 Annual Report Download - page 372

American International Group, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The following table presents the net deferred tax assets (liabilities) for December 31, 2011, and December 31,
2010, respectively, on a U.S. GAAP basis:
December 31,
(in millions) 2011 2010
Net U.S. consolidated return group deferred tax assets $ 27,691 $ 26,563
Net deferred tax assets (liabilities) in Other comprehensive income (2,938) (2,901)
Valuation allowance (7,240) (23,840)
Subtotal 17,513 (178)
Net foreign, state & local deferred tax assets* 2,836 2,126
Valuation allowance (3,778) (3,225)
Subtotal (942) (1,099)
Total AIG net deferred tax assets (liabilities) $ 16,571 $ (1,277)
* Amount includes deferred tax liabilities for certain jurisdictions which are not available to offset deferred tax assets from other jurisdictions.
At December 31, 2011, and December 31, 2010, AIG’s U.S. consolidated income tax group had net deferred tax
assets (liabilities) after valuation allowance of $17.5 billion and $(178) million, respectively. At December 31, 2011,
and December 31, 2010, AIG’s U.S. consolidated income tax group had valuation allowances of $7.2 billion and
$23.8 billion, respectively.
For the year ended December 31, 2011, the decrease in the U.S. consolidated income tax group deferred tax
asset valuation allowance was $16.6 billion. The entire decrease in valuation allowance was allocated to continuing
operations. The amount allocated to continuing operations also included the decrease in the valuation allowance
attributable to the anticipated inclusion of the ALICO SPV within the 2011 U.S. consolidated federal income tax
return.
At December 31, 2011 and December 31, 2010, AIG had net deferred tax liabilities of $942 million and
$1.1 billion, respectively, related to foreign subsidiaries, state and local tax jurisdictions, and certain domestic
subsidiaries that file separate tax returns.
At December 31, 2011 and December 31, 2010, AIG had deferred tax asset valuation allowances of $3.8 billion
and $3.2 billion, respectively, related to foreign subsidiaries, state and local tax jurisdictions, and certain domestic
subsidiaries that file separate tax returns. AIG maintained these valuation allowances following its conclusion that
it could not demonstrate that it was more likely than not that the related deferred tax assets will be realized. This
was primarily due to factors such as cumulative losses in recent years and the inability to demonstrate profits
within the specific jurisdictions over the relevant carryforward periods.
AIG and its eligible U.S. subsidiaries file a consolidated U.S. federal income tax return. Several U.S.
subsidiaries included in the consolidated financial statements previously filed separate U.S. federal income tax
returns and were not part of the AIG U.S. consolidated income tax group. Subsidiaries operating outside the U.S.
are taxed, and income tax expense is recorded, based on applicable U.S. and foreign law.
358 AIG 2011 Form 10-K
DEFERRED TAX ASSET VALUATION ALLOWANCE OF U.S. CONSOLIDATED
INCOME TAX GROUP
DEFERRED TAX LIABILITY – FOREIGN, STATE AND LOCAL
TAX EXAMINATIONS AND LITIGATION