Income Taxes (Tables)

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Schedule of Income Before Taxes and Equity in Earnings of Affiliates

Income (loss) before taxes and equity in earnings of affiliates were as follows:

	Years Ended
	December 31, 2020		December 31, 2019		December 29, 2018
Domestic	$	(164)	$	(809)	$	59
Foreign	140		(220)		84
Total income (loss) before taxes and equity in earnings of affiliates	$	(24)	$	(1,029)	$	143

Schedule of Provisions for Income Taxes

The provisions for income taxes were as follows:

	Years Ended
	December 31, 2020		December 31, 2019 (as revised)		December 29, 2018
Current income tax (benefit) expense:
U.S. federal	$	1	$	—	$	13
State and local	2		2		4
Foreign	22		16		25
Total current income tax (benefit) expense	25		18		42
Deferred income tax (benefit) expense:
U.S. federal	(25)		(46)		—
State and local	(1)		(10)		—
Foreign	(6)		(8)		(5)
Total deferred income tax (benefit) expense:	(32)		(64)		(5)
Total income tax (benefit) expense	$	(7)	$	(46)	$	37

	As of December 31, 2018
	Previously Reported		Revision		As Revised
Net Parent investment	$	1,576	$	(42)	$	1,534
Total shareholders’ equity	1,494		(42)		1,452
	As of December 31, 2019
Consolidated Balance Sheet	Previously Reported		Revision		As Revised
Non-current deferred income tax assets, net (a)	$	20	$	(2)	$	18
Total assets	3,361		(2)		3,359
Deferred income taxes	47		1		48
Total liabilities	2,095		1		2,096
Additional paid in capital	2,381		(42)		2,339
Accumulated deficit	(1,040)		39		(1,001)
Total shareholders’ equity	1,256		(3)		1,253
Total liabilities, redeemable non-controlling interests, and shareholders’ equity	$	3,361	$	(2)	$	3,359
(a) Included in Investments and other
	Year Ended December 31, 2019
Consolidated Statement of Operations	Previously Reported		Revision		As Revised
Income tax benefit (expense)	$	7	$	39	$	46
Net income (loss)	(1,022)		39		(983)
Net income (loss) attributable to Covetrus	$	(1,019)	$	39	$	(980)
Earnings (Loss) per share attributable to Covetrus:
Basic	$	(9.50)	$	0.36	$	(9.14)
Diluted	$	(9.50)	$	0.36	$	(9.14)

Schedule of Deferred Tax Assets and Liabilities

Significant components of our deferred tax assets and liabilities were as follows:

	Years Ended
	December 31, 2020		December 31, 2019 (as revised)
Deferred income tax assets:
Investment in partnerships	$	—	$	54
Net operating losses and other carryforwards	41		38
Share-based compensation	6		7
Lease asset	20		6
Other assets	17		6
Total deferred income tax assets	84		111
Valuation allowance for deferred tax assets	(11)		(10)
Net deferred income tax assets	73		101
Deferred income tax liabilities:
Intangibles amortization	(74)		(125)
Other liabilities	(18)		(6)
Total deferred income tax liabilities	(92)		(131)
Net deferred income tax assets (liabilities)	$	(19)	$	(30)

The deferred income tax assets (liabilities) are classified in the consolidated balance sheets as follows:

	December 31, 2020		December 31, 2019 (as revised)
Non-current deferred income tax assets, net (a)	$	9	$	18
Non-current deferred income tax liabilities, net	(28)		(48)
Non-current deferred income tax assets (liabilities)	$	(19)	$	(30)
(a) Included in Investments and other

Schedule of Tax Loss Carryforwards

At December 31, 2020, we had the following tax loss and tax credit carryforwards available to offset taxable income in prior and future years:

	Amount		Expiration Period
U.S. federal tax loss carryforwards	$	20	2030 - unlimited
U.S. federal and state interest carryforwards	8		unlimited
U.S. federal other credit carryforwards	2		2030-2040
U.S. state tax loss carryforwards	4		2021 - unlimited
Non-U.S. tax loss carryforwards	7		2021 - unlimited
Total tax loss and tax credit carryforwards	$	41

Summary of Tax Credit Carryforwards

At December 31, 2020, we had the following tax loss and tax credit carryforwards available to offset taxable income in prior and future years:

	Amount		Expiration Period
U.S. federal tax loss carryforwards	$	20	2030 - unlimited
U.S. federal and state interest carryforwards	8		unlimited
U.S. federal other credit carryforwards	2		2030-2040
U.S. state tax loss carryforwards	4		2021 - unlimited
Non-U.S. tax loss carryforwards	7		2021 - unlimited
Total tax loss and tax credit carryforwards	$	41

Schedule of Effective Income Tax Rate Reconciliation

The tax provision (benefit) differs from the amount computed by applying the federal statutory income tax rate due to the following:

	Years Ended
	December 31, 2020		December 31, 2019		December 29, 2018
Income tax provision at federal statutory rate	21.0	%	21	%	21.0	%
Transition tax on deemed repatriation of foreign earnings	—		—		2.8
Pass through non-controlling interest	—		—		(2.1)
State income tax provision, net of federal income tax effect	(3.7)		0.9		1.4
Foreign income tax (benefit) provision	15.7		0.3		1.4
Tax on GILTI	(42.6)		(0.9)		1.4
Excess tax benefits related to share-based compensation	(28.4)		(0.5)		(0.7)
Revaluation of deferred tax assets and liabilities	—		(0.9)		—
Valuation allowance impacts	(2.2)		(0.5)		—
Goodwill impairment	—		(14.4)		—
Non-deductible expenses	(29.3)		(0.6)		—
Reverse Book Gain/(Loss) on Foreign Sales	69.2		0.3		—
Return to Provision	12.1		—		—
Impact of Partnership Inside/Outside Basis Conversion	7.5		—		—
Impact of Uncertain Tax Positions	2.2		0.1		—
Credits	6.6		—		—
Other	0.8		(0.3)		0.7
Effective tax rate	28.9	%	4.5	%	25.9	%

Schedule of Reconciliation of Unrecognized Tax Benefits

The following table provides a reconciliation of unrecognized tax benefits which are included in Other liabilities within the balance sheets:

	Years Ended
	December 31, 2020		December 31, 2019		December 29, 2018
Balance at beginning of period	$	4	$	6	$	8
Additions based on prior year tax positions	(1)		—		2
Reductions from lapse in statutes of limitations	—		(2)		(4)
Balance at end of period	$	3	$	4	$	6