Goldman Sachs 2012 Annual Report Download - page 194

Notes to Consolidated Financial Statements
Note 24.
Income Taxes
Provision for Income Taxes
Income taxes are provided for using the asset and liability
method under which deferred tax assets and liabilities are
recognized for temporary differences between the financial
reporting and tax bases of assets and liabilities. The firm
reports interest expense related to income tax matters in
“Provision for taxes” and income tax penalties in
“Other expenses.”
The tables below present the components of the
provision/(benefit) for taxes and a reconciliation of the
U.S. federal statutory income tax rate to the firm’s
effective income tax rate.
Year Ended December
in millions 2012 2011 2010
Current taxes
U.S. federal $3,013 $ 405 $1,791
State and local 628 392 325
Non-U.S. 447 204 1,083
Total current tax expense 4,088 1,001 3,199
Deferred taxes
U.S. federal (643) 683 1,516
State and local 38 24 162
Non-U.S. 249 19 (339)
Total deferred tax (benefit)/expense (356) 726 1,339
Provision for taxes $3,732 $1,727 $4,538
Year Ended December
2012 2011 2010
U.S. federal statutory income tax rate 35.0% 35.0% 35.0%
State and local taxes, net of U.S. federal income tax effects 3.8 4.4 2.5
Tax credits (1.0) (1.6) (0.7)
Non-U.S. operations (4.8) (6.7) (2.3)
Tax-exempt income, including dividends (0.5) (2.4) (1.0)
Other 0.8 (0.7) 1.7 1
Effective income tax rate 33.3% 28.0% 35.2%
1. Primarily includes the effect of the SEC settlement of $550 million, substantially all of which is non-deductible.
192 Goldman Sachs 2012 Annual Report