Income Taxes (Tables)

12 Months Ended

Sep. 25, 2021

Income Tax Disclosure [Abstract]

Provision for Income Taxes

The provision for income taxes for 2021, 2020 and 2019, consisted of the following (in millions):

	2021		2020		2019
Federal:
Current	$	8,257	$	6,306	$	6,384
Deferred	(7,176)		(3,619)		(2,939)
Total	1,081		2,687		3,445
State:
Current	1,620		455		475
Deferred	(338)		21		(67)
Total	1,282		476		408
Foreign:
Current	9,424		3,134		3,962
Deferred	2,740		3,383		2,666
Total	12,164		6,517		6,628
Provision for income taxes	$	14,527	$	9,680	$	10,481

Reconciliation of Provision for Income Taxes

A reconciliation of the provision for income taxes, with the amount computed by applying the statutory federal income tax rate (21% in 2021, 2020 and 2019) to income before provision for income taxes for 2021, 2020 and 2019, is as follows (dollars in millions):

	2021			2020			2019
Computed expected tax	$	22,933		$	14,089		$	13,805
State taxes, net of federal effect	1,151			423			423
Impacts of the U.S. Tax Cuts and Jobs Act of 2017	—			(582)			—
Earnings of foreign subsidiaries	(4,715)			(2,534)			(2,625)
Foreign-derived intangible income deduction	(1,372)			(169)			(149)
Research and development credit, net	(1,033)			(728)			(548)
Excess tax benefits from equity awards	(2,137)			(930)			(639)
Other	(300)			111			214
Provision for income taxes	$	14,527		$	9,680		$	10,481
Effective tax rate	13.3		%	14.4		%	15.9		%

Significant Components of Deferred Tax Assets and Liabilities

As of September 25, 2021 and September 26, 2020, the significant components of the Company’s deferred tax assets and liabilities were (in millions):

	2021		2020
Deferred tax assets:
Amortization and depreciation	$	5,575	$	8,317
Accrued liabilities and other reserves	5,895		4,934
Lease liabilities	2,406		2,038
Deferred revenue	5,399		1,638
Tax credit carryforwards	4,262		797
Other	1,639		1,612
Total deferred tax assets	25,176		19,336
Less: Valuation allowance	(4,903)		(1,041)
Total deferred tax assets, net	20,273		18,295
Deferred tax liabilities:
Minimum tax on foreign earnings	4,318		7,045
Right-of-use assets	2,167		1,862
Unrealized gains	203		526
Other	512		705
Total deferred tax liabilities	7,200		10,138
Net deferred tax assets	$	13,073	$	8,157

Aggregate Changes in Gross Unrecognized Tax Benefits

The aggregate change in the balance of gross unrecognized tax benefits, which excludes interest and penalties, for 2021, 2020 and 2019, is as follows (in millions):

	2021		2020		2019
Beginning balances	$	16,475	$	15,619	$	9,694
Increases related to tax positions taken during a prior year	816		454		5,845
Decreases related to tax positions taken during a prior year	(1,402)		(791)		(686)
Increases related to tax positions taken during the current year	1,607		1,347		1,697
Decreases related to settlements with taxing authorities	(1,838)		(85)		(852)
Decreases related to expiration of the statute of limitations	(181)		(69)		(79)
Ending balances	$	15,477	$	16,475	$	15,619