Progressive 2014 Annual Report Download - page 29

Aggregate required principal payments on debt outstanding are as follows:
(millions)
Year Payments
2015 $0
2016 0
2017 0
2018 0
2019 0
Thereafter 2,182.8
Total $2,182.8
5. INCOME TAXES
The components of our income tax provision were as follows:
(millions) 2014 2013 2012
Current tax provision $594.4 $460.2 $424.8
Deferred tax expense (benefit) 32.0 94.4 (9.4)
Total income tax provision $626.4 $554.6 $415.4
The provision for income taxes in the accompanying consolidated statements of comprehensive income differed from the
statutory rate as follows:
($ in millions) 2014 2013 2012
Income before income taxes $1,907.4 $1,720.0 $1,317.7
Tax at statutory rate $ 667.6 35% $ 602.0 35% $ 461.2 35%
Tax effect of:
Dividends received deduction (18.3) (1) (17.6) (1) (18.2) (1)
Exempt interest income (13.8) (1) (13.1) (1) (14.7) (1)
Tax-deductible dividends (6.5) 0 (13.6) (1) (11.9) (1)
Tax credits (2.2) 0 (2.3) 0 0 0
Other items, net (0.4) 0 (0.8) 0 (1.0) 0
Total income tax provision $ 626.4 33% $ 554.6 32% $ 415.4 32%
Deferred income taxes reflect the effect for financial statement reporting purposes of temporary differences between the
financial statement carrying amounts and the tax bases of assets and liabilities. At December 31, 2014 and 2013, the
components of the net deferred tax asset (liability) were as follows:
(millions) 2014 2013
Deferred tax assets:
Unearned premiums reserve $ 378.8 $ 361.0
Investment basis differences 60.6 94.8
Non-deductible accruals 208.0 200.7
Loss and loss adjustment expense reserves 76.9 92.0
Other 7.5 14.7
Deferred tax liabilities:
Net unrealized gains on securities (550.3) (509.9)
Hedges on forecasted transactions (0.8) (2.2)
Deferred acquisition costs (160.0) (156.7)
Property and equipment (100.9) (99.6)
Prepaid expenses (11.4) (14.4)
Deferred gain on extinguishment of debt (3.0) (4.8)
Other (4.3) (4.0)
Net deferred tax liability $ (98.9) $ (28.4)
App.-A-28