AIG 2015 Annual Report Download - page 333

ITEM 8 / NOTE 22. INCOME TAXES
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For the year ended December 31, 2013, the effective tax rate on income from continuing operations was 3.8 percent. The
effective tax rate on income from continuing operations differs from the statutory tax rate of 35 percent primarily due to tax
benefits of $2.8 billion related to a decrease in the U.S. Life Insurance Companies’ capital loss carryforward valuation
allowance, $396 million related to a decrease in certain other valuation allowances associated with foreign jurisdictions and
$298 million associated with tax exempt interest income. These items were partially offset by charges of $632 million related
to uncertain tax positions.
The following table presents the components of the net deferred tax assets (liabilities):
December 31,
(in millions) 2015 2014
Deferred tax assets:
Losses and tax credit carryforwards $ 18,680 $18,203
Basis differences on investments 4,886 4,114
Life policy reserves 353 629
Accruals not currently deductible, and other 1,003 1,804
Loss reserve discount 1,021 1,378
Loan loss and other reserves 8152
Unearned premium reserve reduction 1,603 1,269
Flight equipment, fixed assets and intangible assets 129 28
Other 577 220
Employee benefits 1,286 1,543
Total deferred tax assets 29,546 29,340
Deferred tax liabilities:
Investments in foreign subsidiaries (33) (58)
Deferred policy acquisition costs (3,467) (3,003)
Unrealized gains related to available for sale debt securities (3,077) (5,795)
Total deferred tax liabilities (6,577) (8,856)
Net deferred tax assets before valuation allowance 22,969 20,484
Valuation allowance (3,012) (1,739)
Net deferred tax assets (liabilities) $ 19,957 $18,745
The following table presents our U.S. consolidated income tax group tax losses and credits carryforwards as of
December 31, 2015.
December 31, 2015 Tax Expiration
(in millions) Gross Effected Periods
Net o
p
eratin
g
loss carr
y
forwards $34,883 $ 12,209 2028 - 2035
Foreign tax credit carryforwards 6,853 2016 - 2024
Other carryforwards 538 Various
Total AIG U.S. consolidated income tax group tax losses and credits
carryforwards on a tax return basis 19,600
Unrecognized tax benefit (2,523)
Total AIG U.S. consolidated income tax group tax losses and credits
carryforwards on a U.S. GAAP basis* $ 17,077
* Includes other carryforwards, e.g. general business credits, of $326 million on a U.S. GAAP basis.
We have U.S. federal consolidated net operating loss and tax credit carryforwards of approximately $17.1 billion, including
$266 million of the foreign tax credit carryforward originated in tax years 2006 and 2007. The carryforward periods for 2006
and 2007 foreign tax credits expire in 2016 and 2017, respectively. As detailed in the Assessment of Deferred Tax Asset
Valuation Allowance section of this footnote, we determined that it is more likely than not that our U.S. federal consolidated tax
attribute carryforwards will be realized prior to their expiration.