SunTrust 2011 Annual Report Download - page 160
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Please find page 160 of the 2011 SunTrust annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Notes to Consolidated Financial Statements (Continued)
144
Deferred income tax assets and liabilities result from differences between the timing of the recognition of assets and liabilities for
financial reporting purposes and for income tax return purposes. These assets and liabilities are measured using the enacted tax
rates and laws that are currently in effect. The net deferred income tax liability is recorded in other liabilities in the Consolidated
Balance Sheets. The significant components of the DTAs and DTLs as of December 31 were as follows:
(Dollars in millions)
DTAs:
Allowance for loan and lease losses
Accrued expenses
State NOL and other carryforwards (net of federal benefit)
Federal NOL
Federal credits and other carryforwards
Other
Total gross DTAs
Valuation allowance
Total DTAs
DTLs:
Net unrealized gains in AOCI
Leasing
Compensation and employee benefits
MSRs
Loans
Goodwill and intangible assets
Fixed assets
Other
Total DTLs
Net DTL
2011
$906
509
197
—
266
175
2,053
(65)
$1,988
$995
728
100
613
47
121
177
95
$2,876
($888)
2010
$1,092
378
182
24
256
276
2,208
(50)
$2,158
$915
701
88
610
135
97
148
113
$2,807
($649)
The DTAs include a federal NOL and other federal carryforwards of $266 million and $280 million as of December 31, 2011 and
2010, respectively, the majority of which will expire, if not utilized, by 2031. The DTAs also include state NOLs and other state
carryforwards of $197 million and $182 million as of December 31, 2011 and 2010, respectively. The state carryforwards will
expire, if not utilized, in varying amounts from 2012 to 2031. At December 31, 2011 and 2010, the Company recorded a valuation
allowance against its state carryforwards and certain state DTAs of $65 million and $50 million, respectively. The Company
determined that a valuation allowance is not required for the federal and the remaining state DTAs because it is more likely than
not these assets will be realized against future taxable income.
As of December 31, 2011 and 2010, the Company’s liability for UTBs, excluding interest and penalties, was $133 million and
$132 million, respectively. The amount of UTBs that, if recognized, would affect the Company's effective tax rate was $90 million
at December 31, 2011. Additionally, the Company had a liability of $21 million for interest related to its UTBs at December 31,
2011 and 2010. Interest income recognized related to UTBs was less than $1 million and approximately $10 million for the years
ended December 31, 2011 and 2010, respectively. Interest related to UTBs is recorded as a component of the income tax provision.
The Company continually evaluates the UTBs associated with its uncertain tax positions. It is reasonably possible that the liability
for UTBs could decrease during the next 12 months by up to $40 million due to completion of tax authority examinations and the
expiration of statutes of limitations.
The Company files consolidated and separate income tax returns in the U.S. federal jurisdiction and in various state jurisdictions.
The Company's federal income tax returns are no longer subject to examination by the IRS for taxable years prior to 2006. The
IRS audit of the 2006 federal income tax return is closed, but the return is still subject to examination to the extent of carryback
claims. The Company's 2007 through 2009 federal income tax returns are currently under examination by the IRS. With limited
exceptions, the Company is no longer subject to examination by state and local taxing authorities for taxable years prior to 2006.