Capital One 2014 Annual Report Download - page 247

NOTE 17—INCOME TAXES
We account for income taxes in accordance with the accounting guidance prescribed by the FASB, recognizing the
current and deferred tax consequences of all transactions that have been recognized in the consolidated financial
statements using the provisions of enacted tax laws. Deferred tax assets and liabilities are determined based on
differences between the financial reporting and tax basis of assets and liabilities and are measured using the enacted
tax rates and laws that will be in effect when the differences are expected to reverse. Valuation allowances are
recorded to reduce deferred tax assets to an amount that is more likely than not to be realized. As of January 1, 2014,
we adopted the proportional amortization method of accounting for Investments in Qualified Affordable Housing
Projects. See “Note 1—Summary of Significant Accounting Policies” for additional information. Prior periods have
been recast to conform to this presentation.
The following table presents significant components of the provision for income taxes attributable to continuing
operations:
Table 17.1: Significant Components of the Provision for Income Taxes Attributable to Continuing Operations
Year Ended December 31,
(Dollars in millions) 2014 2013 2012
Current income tax provision:
Federal taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,934 $1,581 $1,590
State taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 197 194 154
International taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91 115 44
Total current provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,222 $1,890 $1,788
Deferred income tax (benefit) provision:
Federal taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (125) $ 284 $ (246)
State taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 46 (85)
International taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 4 18
Total deferred (benefit) provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (76) $ 334 $ (313)
Total income tax provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,146 $2,224 $1,475
The international income tax provision is related to pre-tax earnings from foreign operations of approximately $466
million in 2014, $459 million in 2013, and $296 million in 2012.
Income tax benefits of $1 million in both of 2014 and 2013, and $620 million in 2012, were allocated directly to
reduce goodwill from acquisitions.
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CAPITAL ONE FINANCIAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Capital One Financial Corporation (COF)