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80
CVS Caremark
Notes to Consolidated Financial Statements
11 Income Taxes
The income tax provision for continuing operations consisted of the following for the respective years:
In millions
2013 2012 2011
Current:
Federal
$ 2,623
$ 2,226 $ 1,807
State
437
410 338
3,060
2,636 2,145
Deferred:
Federal
(115)
(182) 101
State
(17)
(18) 12
(132)
(200) 113
Total
$ 2,928
$ 2,436 $ 2,258
The following table is a reconciliation of the statutory income tax rate to the Company’s effective income tax rate for
continuing operations for the respective years:
2013 2012 2011
Statutory income tax rate
35.0 %
35.0 % 35.0 %
State income taxes, net of federal tax benefit
4.0
3.9 3.9
Other
(0.1)
(0.3) 0.4
Effective income tax rate
38.9 %
38.6 % 39.3 %
The following table is a summary of the significant components of the Company’s deferred tax assets and liabilities
as of December 31:
In millions
2013 2012
Deferred tax assets:
Lease and rents
$ 344
$ 336
Inventories
—
141
Employee benefits
213
202
Allowance for doubtful accounts
79
137
Retirement benefits
172
115
Net operating losses
10
5
Depreciation
192
—
Other
598
430
Valuation allowance
(3)
—
Total deferred tax assets
1,605
1,366
Deferred tax liabilities:
Inventories
(69)
—
Depreciation and amortization
(4,512)
(4,457)
Total deferred tax liabilities
(4,581)
(4,457)
Net deferred tax liabilities
$ (2,976)
$ (3,091)