Income Taxes

3 Months Ended

Mar. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Note 11    Income Taxes

The components of income tax expense were:

	Three Months Ended   March 31
(Dollars in Millions)	2021		2020
Federal
Current	$	353	$	315
Deferred		130		(106	)
Federal income tax		483		209
State
Current		94		70
Deferred		30		(19	)
State income tax		124		51
Total income tax provision	$	607	$	260

A reconciliation of expected income tax expense at the federal statutory rate of 21 percent to the Company’s applicable income tax expense follows:

	Three Months Ended   March 31
(Dollars in Millions)	2021			2020
Tax at statutory rate	$	607		$	302
State income tax, at statutory rates, net of federal tax benefit		114			59
Tax effect of
Tax credits and benefits, net of related expenses		(93	)		(102	)
Tax-exempt income		(28	)		(29	)
Other items		7			30
Applicable income taxes	$	607		$	260

The Company’s income tax returns are subject to review and examination by federal, state, local and foreign government authorities. On an ongoing basis, numerous federal, state, local and foreign examinations are in progress and cover multiple tax years. As of March 31, 2021, federal tax examinations for all years ending through December 31, 2014 are completed and resolved. The Company’s tax returns for the years ended December 31, 2015, 2016, 2017 and 2018 are under examination by the Internal Revenue Service. The years open to examination by foreign, state and local government authorities vary by jurisdiction.

The Company’s net deferred tax asset was $1.3 billion at March 31, 2021 and $597 million at December 31, 2020.