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Income Taxes (Tables)

12 Months Ended

Dec. 30, 2011

Schedule of breakdown of income tax expense between current and deferred

The breakdown of income tax expense between current and deferred is as follows:



(Dollars in Millions)	Fiscal Years
Current:	2011			2010		2009
Federal	$	353		$	451	$	151
State	104			58		37
Total Current	$	457		$	509	$	188

Deferred:
Federal	614			372		407
State ^(a)	(5		)	102		23
Total Deferred	$	609		$	474	$	430
Total	$	1,066		$	983	$	618

Schedule of income tax expense reconciled to tax computed at statutory rates



	Fiscal Years
(Dollars In Millions)	2011					2010					2009
Federal Income Taxes	$	1,011		35.0	%	$	891		35.0	%	$	610		35.0	%
State Income Taxes	63			2.2	%	85			3.4	%	37			2.1	%
Corporate Reorganization	—			—	%	16			0.6	%	—			—	%
Other Items^(a)	(8		)	(0.3	)%	(9		)	(0.4	)%	(29		)	(1.6	)%
Income Tax Expense/Rate	$	1,066		36.9	%	$	983		38.6	%	$	618		35.5	%

(a) Other items primarily include tax impacts from equity in Conrail and other partially owned subsidiaries’ earnings.

Schedule of significant components of deferred income tax assets and liabilities

The significant components of deferred income tax assets and liabilities include:



	2011				2010
(Dollars in Millions)	Assets		Liabilities		Assets		Liabilities
Pension Plans	$	300	$	—	$	243	$	—
Other Employee Benefit Plans	309		—		311		—
Accelerated Depreciation	—		8,148		—		7,557
Other	354		234		353		211
Total	$	963	$	8,382	$	907	$	7,768
Net Deferred Income Tax Liabilities			$	7,419			$	6,861

Schedule of change to total gross unrecognized tax benefits

The change to the total gross unrecognized tax benefits and prior year audit resolutions of the Company during the fiscal year ended December 2011 is reconciled as follows:



Uncertain Tax Positions:	Fiscal Year
(Dollars in Millions)	2011			2010
Balance at beginning of the year	$	20		$	50
Additions based on tax positions related to current year	1			3
Additions based on tax positions related to prior years	10			17
Reductions based on tax positions related to prior years	(3		)	(41		)
Settlements with taxing authorities	(5		)	—
Lapse of statute of limitations	(1		)	(9		)
Balance at end of the year	$	22		$	20

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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