Income Taxes (Tables)

12 Months Ended

Sep. 24, 2022

Income Tax Disclosure [Abstract]

Provision for Income Taxes

The provision for income taxes for 2022, 2021 and 2020, consisted of the following (in millions):

	2022		2021		2020
Federal:
Current	$	7,890	$	8,257	$	6,306
Deferred	(2,265)		(7,176)		(3,619)
Total	5,625		1,081		2,687
State:
Current	1,519		1,620		455
Deferred	84		(338)		21
Total	1,603		1,282		476
Foreign:
Current	8,996		9,424		3,134
Deferred	3,076		2,740		3,383
Total	12,072		12,164		6,517
Provision for income taxes	$	19,300	$	14,527	$	9,680

Reconciliation of Provision for Income Taxes to Amount Computed by Applying the Statutory Federal Income Tax Rate to Income Before Provision for Income Taxes

A reconciliation of the provision for income taxes to the amount computed by applying the statutory federal income tax rate (21% in 2022, 2021 and 2020) to income before provision for income taxes for 2022, 2021 and 2020, is as follows (dollars in millions):

	2022			2021			2020
Computed expected tax	$	25,012		$	22,933		$	14,089
State taxes, net of federal effect	1,518			1,151			423
Impacts of the Act	542			—			(582)
Earnings of foreign subsidiaries	(4,366)			(4,715)			(2,534)
Foreign-derived intangible income deduction	(296)			(1,372)			(169)
Research and development credit, net	(1,153)			(1,033)			(728)
Excess tax benefits from equity awards	(1,871)			(2,137)			(930)
Other	(86)			(300)			111
Provision for income taxes	$	19,300		$	14,527		$	9,680
Effective tax rate	16.2		%	13.3		%	14.4		%

Significant Components of Deferred Tax Assets and Liabilities

As of September 24, 2022 and September 25, 2021, the significant components of the Company’s deferred tax assets and liabilities were (in millions):

	2022		2021
Deferred tax assets:
Amortization and depreciation	$	1,496	$	5,575
Accrued liabilities and other reserves	6,515		5,895
Lease liabilities	2,400		2,406
Deferred revenue	5,742		5,399
Unrealized losses	2,913		53
Tax credit carryforwards	6,962		4,262
Other	1,596		1,639
Total deferred tax assets	27,624		25,229
Less: Valuation allowance	(7,530)		(4,903)
Total deferred tax assets, net	20,094		20,326
Deferred tax liabilities:
Minimum tax on foreign earnings	1,983		4,318
Right-of-use assets	2,163		2,167
Unrealized gains	942		203
Other	469		565
Total deferred tax liabilities	5,557		7,253
Net deferred tax assets	$	14,537	$	13,073

Aggregate Changes in Gross Unrecognized Tax Benefits

The aggregate change in the balance of gross unrecognized tax benefits, which excludes interest and penalties, for 2022, 2021 and 2020, is as follows (in millions):

	2022		2021		2020
Beginning balances	$	15,477	$	16,475	$	15,619
Increases related to tax positions taken during a prior year	2,284		816		454
Decreases related to tax positions taken during a prior year	(1,982)		(1,402)		(791)
Increases related to tax positions taken during the current year	1,936		1,607		1,347
Decreases related to settlements with taxing authorities	(28)		(1,838)		(85)
Decreases related to expiration of the statute of limitations	(929)		(181)		(69)
Ending balances	$	16,758	$	15,477	$	16,475