Kodak 2013 Annual Report Download - page 102

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Table of Contents
During 2012 and 2011, Kodak determined that it was more likely than not that a portion of the deferred tax assets outside the U.S. would not be
realized due to reduced manufacturing volumes negatively impacting profitability in a location outside the U.S. and accordingly, recorded a
provision of $30 million and $53 million, respectively, associated with the establishment of a valuation allowance on those deferred tax assets.
In March 2011, Kodak filed a Request for Competent Authority Assistance with the United States Internal Revenue Service (“IRS”). The
request related to a potential double taxation issue with respect to certain patent licensing royalty payments received by Kodak in 2012 and
2011. In the twelve months ended December 31, 2012, Kodak received notification that the IRS had reached agreement with the Korean
National Tax Service (
“NTS”) with regards to Kodak’s March 2011 request. As a result of the agreement reached by the IRS and NTS, Kodak
was due a partial refund of Korean withholding taxes in the amount of $123 million. Kodak had previously agreed with the licensees that made
the royalty payments that any refunds of the related Korean withholding taxes would be shared equally between Kodak and the licensees. The
licensees’
share ($61 million) of the Korean withholding tax refund has therefore been reported as a licensing revenue reduction in Licensing &
royalties in the Consolidated Statement of Operations.
PAGE 96
As of December 31,
(in millions)
Successor
2013
Predecessor
2012
Deferred tax assets
Pension and postretirement obligations
$
219
$
689
Allowed Claims
—
272
Restructuring programs
6
10
Foreign tax credit
101
577
Inventories
18
26
Investment tax credit
125
153
Employee deferred compensation
60
113
Depreciation
—
57
Research and development costs
276
308
Tax loss carryforwards
372
1,409
Goodwill/Intangibles
—
42
Other deferred revenue
13
—
Other
168
373
Total deferred tax assets
$
1,358
$
4,029
Deferred tax liabilities
Depreciation
$
17
$
—
Leasing
23
43
Goodwill/Intangibles
49
—
Other deferred debt
—
11
Unremitted foreign earnings
236
416
Other
25
182
Total deferred tax liabilities
350
652
Net deferred tax assets before valuation allowance
1,008
3,377
Valuation allowance
953
2,838
Net deferred tax assets
$
55
$
539