DuPont 2014 Annual Report Download - page 71

E. I. du Pont de Nemours and Company
Notes to the Consolidated Financial Statements (continued)
(Dollars in millions, except per share)
F-18
Consolidated income from continuing operations before income taxes for U.S. and international operations was as follows:
2014 2013 2012
U.S. (including exports) $ 2,780 $ 962 $ 640
International 2,211 2,527 2,448
Income from continuing operations before income taxes $ 4,991 $ 3,489 $ 3,088
The increased proportion of income from continuing operations before income taxes in the U.S over prior years is primarily due
to the results of the company’s hedging program, gains on sales of businesses primarily in the U.S., and the impact of Imprelis®
charges in the U.S. in 2013 versus additional insurance recoveries recorded in the U.S. in 2014.
In 2014 and 2013, the U.S. recorded a net exchange gain associated with the hedging program of $607 and $35, respectively.
While the taxation of the amounts reflected on the chart above does not correspond precisely to the jurisdiction of taxation (due
to taxation in multiple countries, exchange gains/losses, etc.), it represents a reasonable approximation of the income before income
taxes split between U.S. and international jurisdictions. See Note 19 for additional information regarding the company's hedging
program.
Under the tax laws of various jurisdictions in which the company operates, deductions or credits that cannot be fully utilized for
tax purposes during the current year may be carried forward or back, subject to statutory limitations, to reduce taxable income or
taxes payable in future or prior years. At December 31, 2014, the tax effect of such carryforwards/backs, net of valuation allowance
approximated $1,080. Of this amount, $921 has no expiration date, $1 expires after 2014 but before the end of 2019 and $158
expires after 2019.
At December 31, 2014, unremitted earnings of subsidiaries outside the U.S. totaling $17,226 were deemed to be indefinitely
reinvested. No deferred tax liability has been recognized with regard to the remittance of such earnings. It is not practicable to
estimate the income tax liability that might be incurred if such earnings were remitted to the U.S.
Each year the company files hundreds of tax returns in the various national, state and local income taxing jurisdictions in which
it operates. These tax returns are subject to examination and possible challenge by the tax authorities. Positions challenged by the
tax authorities may be settled or appealed by the company. As a result, there is an uncertainty in income taxes recognized in the
company's financial statements in accordance with accounting for income taxes and accounting for uncertainty in income taxes.
It is reasonably possible that net reductions to the company’s global unrecognized tax benefits could be in the range of $100 to
$125 within the next 12 months with the majority due to the settlement of uncertain tax positions with various tax authorities.