Qualcomm 2014 Annual Report Download - page 73

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QUALCOMM Incorporated
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 4. Income Taxes
The components of the income tax provision for continuing operations were as follows (in millions):
The foreign component of the income tax provision consists primarily of foreign withholding taxes on royalty fees included in United States
earnings.
The components of income from continuing operations before income taxes by United States and foreign jurisdictions were as follows (in
millions):
The following is a reconciliation of the expected statutory federal income tax provision to the Company’s actual income tax provision for
continuing operations (in millions):
The Company’s QCT segment
’
s non-United States headquarters is located in Singapore. The Company has obtained tax incentives in
Singapore that commenced in March 2012, which are effective through March 2027, that result in a tax exemption for the first five years
provided that the Company meets specified employment and investment criteria. The Company’s Singapore tax rate will increase in fiscal 2017
and again in fiscal 2027 as a result of expiration of these incentives. Had the Company established QCT’s non-United States headquarters in
Singapore without these tax incentives, the Company’s income tax expense would have been higher and impacted earnings per share attributable
to Qualcomm as follows (in millions, except per share amounts):
F- 17
2014
2013
2012
Current provision:
Federal
$
172
$
324
$
140
State
10
15
1
Foreign
1,116
1,068
934
1,298
1,407
1,075
Deferred (benefit) provision:
Federal
(30
)
(32
)
208
State
(10
)
6
(16
)
Foreign
(14
)
(32
)
12
(54
)
(58
)
204
$
1,244
$
1,349
$
1,279
2014
2013
2012
United States
$
3,213
$
3,798
$
3,525
Foreign
5,565
4,396
3,037
$
8,778
$
8,194
$
6,562
2014
2013
2012
Expected income tax provision at federal statutory tax rate
$
3,072
$
2,868
$
2,297
State income tax provision, net of federal benefit
24
26
24
Foreign income taxed at other than U.S. rates
(1,750
)
(1,362
)
(1,045
)
Research and development tax credits
(61
)
(195
)
(36
)
Other
(41
)
12
39
$
1,244
$
1,349
$
1,279
2014
2013
2012
Additional income tax expense
$
690
$
758
$
193
Reduction to basic earnings per share
$
0.41
$
0.44
$
0.11
Reduction to diluted earnings per share
$
0.40
$
0.43
$
0.11