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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

Income before provision for income taxes was as follows:


	Year Ended December 31,
	2021		2020		2019
	(in thousands)
United States	$	5,365,547	$	2,789,064	$	1,719,326
Foreign	474,556		410,285		342,905
Income before income taxes	$	5,840,103	$	3,199,349	$	2,062,231

Components of Provision for Income Taxes

The components of provision for income taxes for all periods presented were as follows:


	Year Ended December 31,
	2021		2020		2019
	(in thousands)
Current tax provision:
Federal	$	57,526	$	24,221	$	21,498
State	109,641		65,821		45,228
Foreign	357,189		277,846		223,328
Total current	524,356		367,888		290,054
Deferred tax provision:
Federal	188,937		(57,765)		(28,003)
State	(2,700)		164,685		(54,507)
Foreign	13,282		(36,854)		(12,229)
Total deferred	199,519		70,066		(94,739)
Provision for income taxes	$	723,875	$	437,954	$	195,315

Reconciliation of Provision for Income Taxes

A reconciliation of the provision for income taxes, with the amount computed by applying the statutory Federal income tax rate to income before income taxes is as follows:


	Year Ended December 31,
	2021			2020			2019
	(in thousands)
Expected tax expense at U.S. Federal statutory rates	$	1,226,422		$	671,864		$	433,059
State income taxes, net of Federal income tax effect	111,400			65,808			47,909
Foreign earnings at other than U.S. rates	(23,963)			12,212			56,969
Federal and California R&D tax credits	(82,909)			(113,882)			(134,523)
Valuation allowance on California R&D tax credits	—			183,283			—
Excess tax benefits on stock-based compensation	(290,899)			(339,436)			(148,693)
Tax effects of the Tax Cuts and Jobs Act	(254,763)			(87,194)			(127,534)
Global corporate structure simplification	—			—			35,939
Nondeductible Officers Compensation	26,874			30,351			24,111
Other	11,713			14,948			8,078
Provision for income taxes	$	723,875		$	437,954		$	195,315
Effective Tax Rate	12		%	14		%	9		%

Deferred Tax Assets and Liabilities

The components of deferred tax assets and liabilities were as follows:


	As of December 31,
	2021		2020
	(in thousands)
Deferred tax assets:
Stock-based compensation	$	351,238	$	296,646
Federal and California tax R&D credits	484,793		513,413
Foreign tax credits	2,045		—
Accruals and reserves	165,214		74,239
Operating leases	570,830		436,838
Foreign Net Operating Losses	8,043		29,894
Unrealized Gain/Loss	13,772		114,884
Other	5,420		2,543
Gross deferred tax assets	1,601,355		1,468,457
Depreciation & amortization	(388,115)		(229,142)
Operating leases	(506,403)		(400,380)
Acquisitions	(240,334)		—
Gross deferred tax liabilities	(1,134,852)		(629,522)
Valuation allowance	(318,408)		(249,844)
Net deferred tax assets	$	148,095	$	589,091

Summary of Changes in Unrecognized Tax Benefits

The aggregate changes in the Company’s total gross amount of unrecognized tax benefits are summarized as follows (in thousands):


Balances as of December 31, 2019	$	66,768
Increases related to tax positions taken during prior periods	11,943
Decreases related to tax positions taken during prior periods	(3,697)
Increases related to tax positions taken during the current period	65,110
Decreases related to expiration of statute of limitations	—
Balances as of December 31, 2020	140,124
Increases related to tax positions taken during prior periods	27,116
Decreases related to tax positions taken during prior periods	—
Increases related to tax positions taken during the current period	35,317
Decreases related to expiration of statute of limitations	—


Balances as of December 31, 2021	$	202,557