Tax Matters (Tables)

12 Months Ended

Dec. 31, 2024

Income Tax Disclosure [Abstract]

Schedule of Income before Income Tax, Domestic and Foreign

The components of Income before provision for taxes on income follow:

	Year Ended December 31,
(MILLIONS OF DOLLARS)	2024		2023		2022
United States	$	1,867	$	1,636	$	1,645
International	1,266		1,300		1,011
Income before provision for taxes on income	$	3,133	$	2,936	$	2,656

Schedule Of Components Of Provision For Income Taxes

The components of Provision for taxes on income based on the location of the taxing authorities follow:

	Year Ended December 31,
(MILLIONS OF DOLLARS)	2024		2023		2022
United States:
Current income taxes:
Federal	$	645	$	341	$	514
State and local	65		35		81
Deferred income taxes:
Federal	(297)		(40)		(198)
State and local	(42)		25		(49)
Total U.S. tax provision	371		361		348
International:
Current income taxes	265		281		235
Deferred income taxes	1		(46)		(38)
Total international tax provision	266		235		197
Provision for taxes on income	$	637	$	596	$	545

Schedule of Effective Income Tax Rate Reconciliation

The reconciliation of the U.S. statutory income tax rate to our effective tax rate follows:

	Year Ended December 31,
	2024		2023		2022
U.S. statutory income tax rate	21	%	21	%	21	%
State and local taxes, net of federal benefits	0.6		1.6		0.9
Unrecognized tax benefits and tax settlements and resolution of certain tax positions(a)	0.4		0.9		0.1
Foreign Derived Intangible Income	(1.5)		(0.7)		(0.2)
U.S. Research and Development Tax Credit	(0.6)		(0.7)		(0.7)
Share-based payments	(0.2)		(0.3)		(0.6)
Non-deductible / non-taxable items	0.2		0.2		0.1
Taxation of non-U.S. operations	0.2		(0.8)		(0.4)
All other—net	0.2		(0.9)		0.3
Effective tax rate	20.3	%	20.3	%	20.5	%

(a)    For a discussion about unrecognized tax benefits and tax settlements and resolution of certain tax positions, see C. Tax Contingencies.

Schedule of Deferred Tax Assets and Liabilities

The components of our deferred tax assets and liabilities follow:

	As of December 31,
	2024		2023
(MILLIONS OF DOLLARS)	Assets (Liabilities)
Prepaid/deferred items	$	219	$	72
Inventories	21		30
Capitalized research and development for tax	301		224
Identifiable intangible assets	(103)		(154)
Property, plant and equipment	(179)		(199)
Employee benefits	74		62
Restructuring and other charges	10		(1)
Legal and product liability reserves	14		12
Net operating loss/credit carryforwards	139		133
Unremitted earnings	(3)		(4)
All other	3		16
Subtotal	496		191
Valuation allowance	(123)		(131)
Net deferred tax asset/(liability)(a)(b)	$	373	$	60

(a)    The change in the total net deferred tax asset/(liability) from December 31, 2023 to December 31, 2024 is primarily attributable to an increase in deferred tax assets related to (i) prepaid/deferred items as a result of a prepayment from a related foreign entity in Belgium; and (ii) the capitalization and amortization of research and development costs for U.S. tax purposes, as well as a decrease in deferred tax liabilities related to identifiable intangible assets.

(b)    In 2024, included in Noncurrent deferred tax assets ($540 million) and Noncurrent deferred tax liabilities ($167 million). In 2023, included in Noncurrent deferred tax assets ($206 million) and Noncurrent deferred tax liabilities ($146 million).

Schedule of Unrecognized Tax Benefits Roll Forward

The reconciliation of the beginning and ending amounts of gross unrecognized tax benefits follows:

(MILLIONS OF DOLLARS)	2024		2023		2022
Balance, January 1	$	(209)	$	(194)	$	(189)
Increases based on tax positions taken during a prior period(a)	(1)		(27)		(20)
Decreases based on tax positions taken during a prior period(a)	—		20		9
Increases based on tax positions taken during the current period(a)	(7)		(13)		(4)
Settlements	1		—		7
Lapse in statute of limitations(a)	3		5		3
Balance, December 31(b)	$	(213)	$	(209)	$	(194)

(a)    Primarily included in Provision for taxes on income.

(b)    In 2024, included in Other taxes payable ($213 million). In 2023, included in Other taxes payable ($209 million). In 2022, included in Noncurrent deferred tax assets and Other noncurrent assets ($2 million) and Other taxes payable ($192 million).