Berkshire Hathaway 2013 Annual Report Download - page 54
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Notes to Consolidated Financial Statements (Continued)
(16) Income taxes (Continued)
The tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax
liabilities are shown below (in millions).
December 31,
2013 2012
Deferred tax liabilities:
Investments – unrealized appreciation and cost basis differences .................... $25,660 $16,075
Deferred charges reinsurance assumed ......................................... 1,526 1,392
Property, plant and equipment ............................................... 32,409 29,715
Other ................................................................... 6,278 6,485
65,873 53,667
Deferred tax assets:
Unpaid losses and loss adjustment expenses .................................... (817) (924)
Unearned premiums ....................................................... (682) (660)
Accrued liabilities ......................................................... (3,398) (3,466)
Derivative contract liabilities ................................................ (374) (1,131)
Other ................................................................... (3,160) (3,603)
(8,431) (9,784)
Net deferred tax liability ........................................................ $57,442 $43,883
We have not established deferred income taxes with respect to undistributed earnings of certain foreign subsidiaries.
Earnings expected to remain reinvested indefinitely were approximately $9.3 billion as of December 31, 2013. Upon
distribution as dividends or otherwise, such amounts would be subject to taxation in the U.S. as well as foreign countries.
However, U.S. income tax liabilities would be offset, in whole or in part, by allowable tax credits deriving from income taxes
previously paid to foreign jurisdictions. Further, repatriation of all earnings of foreign subsidiaries would be impracticable to the
extent that such earnings represent capital needed to support normal business operations in those jurisdictions. As a result, we
currently believe that any incremental U.S. income tax liabilities arising from the repatriation of distributable earnings of
foreign subsidiaries would not be material.
Income tax expense reflected in our Consolidated Statements of Earnings for each of the three years ending December 31,
2013 is as follows (in millions).
2013 2012 2011
Federal ............................................................... $8,155 $5,695 $3,474
State ................................................................. 258 384 444
Foreign ............................................................... 538 845 650
$8,951 $6,924 $4,568
Current ............................................................... $5,168 $4,711 $2,897
Deferred .............................................................. 3,783 2,213 1,671
$8,951 $6,924 $4,568
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