Income taxes Income taxes (Tables)

12 Months Ended

Dec. 31, 2013

The provision for income taxes includes the following for the years ended December 31, 2013, 2012 and 2011 (in millions):



	2013			2012			2011
Current provision:
Federal	$	54		$	438		$	551
State	26			47			54
Foreign	191			158			148
Total current provision	271			643			753
Deferred provision (benefit):
Federal	(86		)	83			(273		)
State	19			(43		)	(12		)
Foreign	(20		)	(19		)	(1		)
Total deferred provision (benefit)	(87		)	21			(286		)
Total provision	$	184		$	664		$	467

Significant components of deferred tax assets and liabilities

Significant components of our deferred tax assets and liabilities are as follows as of December 31, 2013 and 2012 (in millions):



	2013			2012
Deferred income tax assets:
NOL and credit carryforwards	$	1,017		$	427
Expense accruals	697			805
Expenses capitalized for tax	196			195
Stock-based compensation	211			115
Deferred revenue	40			40
Other	104			83
Total deferred income tax assets	2,265			1,665
Valuation allowance	(314		)	(273		)
Net deferred income tax assets	1,951			1,392

Deferred income tax liabilities:
Acquired intangibles	(4,430		)	(1,249		)
Fixed assets	(8		)	(117		)
Unremitted foreign earnings	(55		)	(106		)
Other	(200		)	(145		)
Total deferred income tax liabilities	(4,693		)	(1,617		)
Total deferred income taxes, net	$	(2,742	)	$	(225	)

Reconciliation of total gross amounts of unrecognized tax benefits (excluding interest, penalties, foreign tax credits and the federal tax benefit of state taxes related to unrecognized tax benefits)

The reconciliation of the total gross amounts of UTBs (excluding interest, penalties, foreign tax credits and the federal tax benefit of state taxes related to UTBs) for the years ended December 31, 2013, 2012 and 2011 is as follows (in millions):



	2013			2012			2011
Balance at beginning of year	$	1,200		$	975		$	920
Additions based on tax positions related to the current year	335			300			283
Additions based on tax positions related to prior years	96			5			1
Reductions for tax positions of prior years	(192		)	(50		)	(8		)
Settlements	(24		)	(30		)	(221		)
Balance at end of year	$	1,415		$	1,200		$	975

Reconciliation between the federal statutory tax rate and effective tax rate

The reconciliation between the federal statutory tax rate applied to income before income taxes and our effective tax rate for the years ended December 31, 2013, 2012 and 2011, is as follows:



	2013		2012		2011
Federal statutory tax rate	35.0	%	35.0	%	35.0	%
Foreign earnings, including earnings invested indefinitely	(21.3	)%	(17.8	)%	(19.4	)%
Credits, Puerto Rico Excise Tax	(4.7	)%	(5.2	)%	(6.5	)%
Credits, primarily federal R&D	(3.0	)%	—	%	(1.5	)%
State taxes	0.8	%	0.6	%	0.7	%
Audit settlements (federal, state, foreign)	(3.7	)%	0.3	%	—	%
Legal settlements	—	%	(0.2	)%	2.2	%
Other, net	0.4	%	0.6	%	0.8	%
Effective tax rate	3.5	%	13.3	%	11.3	%