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Income Taxes (Tables)

12 Months Ended

Sep. 28, 2024

The provision for income taxes for 2024, 2023 and 2022, consisted of the following (in millions):


	2024		2023		2022
Federal:
Current	$	5,571	$	9,445	$	7,890
Deferred	(3,080)		(3,644)		(2,265)
Total	2,491		5,801		5,625
State:
Current	1,726		1,570		1,519
Deferred	(298)		(49)		84
Total	1,428		1,521		1,603
Foreign:
Current	25,483		8,750		8,996
Deferred	347		669		3,076
Total	25,830		9,419		12,072
Provision for income taxes	$	29,749	$	16,741	$	19,300

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 2024, 2023 and 2022) to income before provision for income taxes for 2024, 2023 and 2022, is as follows (dollars in millions):


	2024			2023			2022
Computed expected tax	$	25,932		$	23,885		$	25,012
State taxes, net of federal effect	1,162			1,124			1,518
Impact of the State Aid Decision	10,246			—			—
Earnings of foreign subsidiaries	(5,311)			(5,744)			(4,366)
Research and development credit, net	(1,397)			(1,212)			(1,153)
Excess tax benefits from equity awards	(893)			(1,120)			(1,871)
Other	10			(192)			160
Provision for income taxes	$	29,749		$	16,741		$	19,300
Effective tax rate	24.1		%	14.7		%	16.2		%

Significant Components of Deferred Tax Assets and Liabilities

As of September 28, 2024 and September 30, 2023, the significant components of the Company’s deferred tax assets and liabilities were (in millions):


	2024		2023
Deferred tax assets:
Capitalized research and development	$	10,739	$	6,294
Tax credit carryforwards	8,856		8,302
Accrued liabilities and other reserves	6,114		6,365
Deferred revenue	3,413		4,571
Lease liabilities	2,410		2,421
Unrealized losses	1,173		2,447
Other	2,168		2,343
Total deferred tax assets	34,873		32,743
Less: Valuation allowance	(8,866)		(8,374)
Total deferred tax assets, net	26,007		24,369
Deferred tax liabilities:
Depreciation	2,551		1,998
Right-of-use assets	2,125		2,179
Minimum tax on foreign earnings	1,674		1,940
Unrealized gains	—		511
Other	455		490
Total deferred tax liabilities	6,805		7,118
Net deferred tax assets	$	19,202	$	17,251

Aggregate Changes in Gross Unrecognized Tax Benefits

The aggregate change in the balance of gross unrecognized tax benefits, which excludes interest and penalties, for 2024, 2023 and 2022, is as follows (in millions):


	2024		2023		2022
Beginning balances	$	19,454	$	16,758	$	15,477
Increases related to tax positions taken during a prior year	1,727		2,044		2,284
Decreases related to tax positions taken during a prior year	(386)		(1,463)		(1,982)
Increases related to tax positions taken during the current year	2,542		2,628		1,936
Decreases related to settlements with taxing authorities	(1,070)		(19)		(28)
Decreases related to expiration of the statute of limitations	(229)		(494)		(929)
Ending balances	$	22,038	$	19,454	$	16,758