Income Taxes (Tables)

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Schedule of sources of income before taxes in equity in income of unconsolidated subsidiaries and affiliates

The sources of income before taxes and equity in income of unconsolidated subsidiaries and affiliates for the years ended December 31, 2023, 2022 and 2021 are as follows:

(in millions of dollars)	2023		2022		2021
Parent country source	$	(48)	$	143	$	161
Foreign sources	2,751		2,539		1,778
Income (loss) of Consolidated Group before Income Taxes	$	2,703	$	2,682	$	1,939

Schedule of income tax provision

The provision for income taxes for the years ended December 31, 2023, 2022 and 2021 consisted of the following:

(in millions of dollars)	2023		2022		2021
Current income taxes	$	1,118	$	819	$	498
Deferred income taxes	(524)		(72)		(269)
Total income tax provision (benefit)	$	594	$	747	$	229

Schedule of reconciliation of income tax expense

Reconciliations of CNH’s income tax expense for the years ended December 31, 2023, 2022 and 2021 are as follows:

(in millions of dollars)	2023		2022		2021
Tax provision at the parent statutory rate	$	635	$	510	$	368
Foreign income taxed at different rates	73		243		136
Change in valuation allowance	(117)		(70)		(207)
Tax contingencies	66		58		(18)
Tax credits and incentives	(136)		(54)		(79)
Change in tax rate or law	—		—		(5)
Other	73		60		34
Total income tax provision (benefit)	$	594	$	747	$	229

Schedule of components of net deferred tax assets

The components of net deferred tax assets as of December 31, 2023 and 2022 are as follows:

(in millions of dollars)	2023		2022
Deferred tax assets:
Warranty and campaigns	$	94	$	86
Allowance for credit losses	137		108
Marketing and sales incentive programs	551		359
Other risk and future charges reserve	57		40
Pension, postretirement and postemployment benefits	104		87
Leasing liabilities	69		55
Research and development costs	234		139
Other reserves	267		251
Tax credits and loss carry forwards	262		266
Less: Valuation allowances	(207)		(343)
Total deferred tax assets	1,568		1,048
Deferred tax liabilities:
Property, plant and equipment	380		370
Intangibles	192		180
Inventories	25		70
Other	27		80
Total deferred tax liabilities	624		700
Net deferred tax assets	$	944	$	348

Net deferred tax assets are reflected in the accompanying consolidated balance sheets as of December 31, 2023 and 2022 as follows:

(in millions of dollars)	2023		2022
Deferred tax assets	$	979	$	433
Deferred tax liabilities	(35)		(85)
Net deferred tax assets	$	944	$	348

Schedule of reconciliation of the gross amounts of tax contingencies

A reconciliation of the gross amounts of tax contingencies at the beginning and end of the year is as follows:

(in millions of dollars)	2023		2022
Balance, beginning of year	$	162	$	143
Additions based on tax positions related to the current year	52		16
Additions for tax positions of prior years	63		35
Reductions for tax positions of prior years	(35)		(16)
Reductions for tax positions as a result of lapse of statute	—		(2)
Settlements	(8)		(14)
Balance, end of year	$	234	$	162