Berkshire Hathaway 2009 Annual Report Download - page 48
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Notes to Consolidated Financial Statements (Continued)
(16) Income taxes
The liability for income taxes as of December 31, 2009 and 2008 as reflected in our Consolidated Balance Sheets is as
follows (in millions).
2009 2008
Payable currently .............................................................. $ (396) $ 161
Deferred ..................................................................... 18,695 9,316
Other ....................................................................... 926 803
$19,225 $10,280
The tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax
liabilities at December 31, 2009 and 2008 are shown below (in millions).
2009 2008
Deferred tax liabilities:
Investments – unrealized appreciation and cost basis differences ...................... $11,880 $ 4,805
Deferred charges reinsurance assumed ........................................... 1,385 1,373
Property, plant and equipment ................................................. 8,135 7,004
Other ..................................................................... 4,236 4,024
25,636 17,206
Deferred tax assets:
Unpaid losses and loss adjustment expenses ...................................... (1,010) (896)
Unearned premiums ......................................................... (500) (495)
Accrued liabilities ........................................................... (1,643) (1,698)
Derivative contract liabilities .................................................. (875) (2,144)
Other ..................................................................... (2,913) (2,657)
(6,941) (7,890)
Net deferred tax liability ........................................................ $18,695 $ 9,316
We have not established deferred income taxes with respect to undistributed earnings of certain foreign subsidiaries.
Earnings expected to remain reinvested indefinitely were approximately $3.8 billion as of December 31, 2009. Upon
distribution as dividends or otherwise, such amounts would be subject to taxation in the United States as well as foreign
countries. However, U.S. income tax liabilities could be offset, in whole or in part, by tax credits allowable from taxes paid to
foreign jurisdictions. Determination of the potential net tax due is impracticable due to the complexities of hypothetical
calculations involving uncertain timing and amounts of taxable income and the effects of multiple taxing jurisdictions.
The Consolidated Statements of Earnings reflect charges for income taxes as shown below (in millions).
2009 2008 2007
Federal ............................................................... $2,833 $ 915 $5,740
State ................................................................. 124 249 234
Foreign .............................................................. 581 814 620
$3,538 $ 1,978 $6,594
Current .............................................................. $1,619 $ 3,811 $5,708
Deferred ............................................................. 1,919 (1,833) 886
$3,538 $ 1,978 $6,594
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