Johnson Controls 2014 Annual Report Download - page 106

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106
expired for the Company on September 30, 2012 but was extended in January 2013 retroactive to the beginning of the Company's
2013 fiscal year.
As a result of changes to Mexican tax law in the first quarter of fiscal 2014, the Company recorded a benefit to income tax expense
of $25 million. Tax legislation was also adopted in various other jurisdictions during the fiscal year ended September 30, 2014.
These law changes did not have a material impact on the Company's consolidated financial statements.
As a result of foreign law changes during the second quarter of fiscal 2013, the Company increased its total reserve for uncertain
tax positions, resulting in income tax expense of $17 million.
During the fiscal year ended September 30, 2012, tax legislation was adopted in Japan which reduced its statutory income tax rate
by 5%. Also, tax legislation was adopted in various jurisdictions to limit the annual utilization of tax losses that are carried forward.
None of these changes had a material impact on the Company’s consolidated financial condition, results of operations or cash
flows.
Continuing Operations
Components of the provision for income taxes on continuing operations were as follows (in millions):
Year Ended September 30,
2014 2013 2012
Current
Federal $ 120 $ 58 $ 149
State 18 30 7
Foreign 611 352 226
749 440 382
Deferred
Federal (138) 215 (88)
State (6) 14 21
Foreign (123) 27 (154)
(267) 256 (221)
Provision for income taxes $ 482 $ 696 $ 161
Consolidated domestic income from continuing operations before income taxes and noncontrolling interests for the fiscal years
ended September 30, 2014, 2013 and 2012 was income of $1,415 million, $2,169 million and $2,119 million, respectively.
Consolidated foreign income (loss) from continuing operations before income taxes and noncontrolling interests for the fiscal
years ended September 30, 2014, 2013 and 2012 was income (loss) of $620 million, $(282) million and $(733) million, respectively.
Income taxes paid for the fiscal years ended September 30, 2014, 2013 and 2012 were $782 million, $531 million and $496 million,
respectively.
The Company has not provided additional U.S. income taxes on approximately $8.1 billion of undistributed earnings of consolidated
foreign subsidiaries included in shareholders’ equity attributable to Johnson Controls, Inc. Such earnings could become taxable
upon the sale or liquidation of these foreign subsidiaries or upon dividend repatriation. The Company’s intent is for such earnings
to be reinvested by the subsidiaries or to be repatriated only when it would be tax effective through the utilization of foreign tax
credits. It is not practicable to estimate the amount of unrecognized withholding taxes and deferred tax liability on such earnings.
In the fourth quarter of fiscal 2014, the Company provided income tax expense on the foreign undistributed earnings of the non-
U.S. subsidiaries related to the Global Workplace Solutions business, which resulted in $35 million of incremental tax expense.
Refer to "Capitalization" within the "Liquidity and Capital Resources" section of Item 7 for discussion of domestic and foreign
cash projections.