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INCOME TAXES (Tables)
 12 Months Ended
Dec. 31, 2017
Income Tax Disclosure [Abstract]  
(Benefit) Provision for Income Taxes
CONSOLIDATED (BENEFIT) PROVISION FOR INCOME TAXES
 
 
 
 
(In millions)
2017

2016

2015

 
 
 
 
U.S. Federal
 
 
 
Current
$
(823
)
$
(2,646
)
$
1,549

Deferred
(4,261
)
(754
)
492

Non - U.S.
 
 
 
Current
2,286

1,730

4,867

Deferred
(470
)
1,239

(121
)
Other
225

(33
)
(301
)
Total
$
(3,043
)
$
(464
)
$
6,485

(BENEFIT) PROVISION FOR INCOME TAXES
 
 
 
 
(In millions)
2017

2016

2015

 
 
 
 
GE
 
 
 
Current tax expense (benefit)
$
2,810

$
(140
)
$
3,307

Deferred tax expense (benefit) from temporary differences
449

1,107

(1,800
)
 
3,259

967

1,506

GE Capital
 
 
 
Current tax expense (benefit)
(1,008
)
(1,138
)
2,796

Deferred tax expense (benefit) from temporary differences
(5,294
)
(293
)
2,183

 
(6,302
)
(1,431
)
4,979

Consolidated
 
 
 
Current tax expense (benefit)
1,802

(1,278
)
6,103

Deferred tax expense (benefit) from temporary differences
(4,845
)
814

383

Total
$
(3,043
)
$
(464
)
$
6,485
Consolidated Earnings (Loss) from Continuing Operations Before Income Taxes
CONSOLIDATED EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
 
 
 
 
(In millions)
2017

2016

2015

 
 
 
 
U.S. earnings
$
(17,234
)
$
2,145

$
(309
)
Non-U.S. earnings
8,443

6,885

8,495

Total
$
(8,791
)
$
9,030

$
8,186
Reconciliation of U.S. Federal Statutory Income Tax Rate to Actual Income Tax Rate
RECONCILIATION OF U.S. FEDERAL STATUTORY INCOME TAX RATE TO ACTUAL INCOME TAX RATE
 
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated
 
GE
 
GE Capital
 
2017

2016

2015

 
2017

2016

2015

 
2017

2016

2015

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. federal statutory income tax rate
35.0
 %
35.0
 %
35.0
 %
 
35.0
 %
35.0
 %
35.0
 %
 
35.0
 %
35.0
%
35.0
 %
Increase (reduction) in rate resulting from
inclusion of after-tax earnings of GE Capital in
before-tax earnings of GE
—

—

—

 
(81.0
)
4.5

82.6

 
—

—

—

Tax on global activities including exports
41.2

(23.7
)
54.1

 
71.0

(20.8
)
(52.8
)
 
12.2

4.9

(224.5
)
U.S. business credits(a)
5.7

(4.5
)
(4.7
)
 
3.1

(0.9
)
(4.1
)
 
3.2

15.7

9.2

Tax Cuts and Jobs Act enactment
(37.8
)
—

—

 
(127.2
)
—

—

 
3.1

—

—

All other – net(b)
(9.5
)
(11.9
)
(5.2
)
 
(12.4
)
(7.9
)
(14.4
)
 
(3.6
)
14.7

(1.5
)
 
(0.4
)
(40.1
)
44.2

 
(146.5
)
(25.1
)
11.3

 
14.9

35.3

(216.8
)
Actual income tax rate
34.6
 %
(5.1
)%
79.2
 %
 
(111.5
)%
9.9
 %
46.3
 %
 
49.9
 %
70.3
%
(181.8
)%
(a)
U.S. general business credits, primarily the credit for energy produced from renewable sources and the credit for research performed in the U.S.
(b)
Includes, for each period, the expense or (benefit) for “Other” taxes reported above in the consolidated (benefit) provision for income taxes, net of 35.0% federal effect.
Unrecognized Tax Benefits
The balance of unrecognized tax benefits, the amount of related interest and penalties we have provided and what we believe to be the range of reasonably possible changes in the next 12 months were:
UNRECOGNIZED TAX BENEFITS
 
 
 
December 31 (In millions)
2017

2016

 
 
 
Unrecognized tax benefits
$
5,449

$
4,692

Portion that, if recognized, would reduce tax expense and effective tax rate(a)
3,626

2,886

Accrued interest on unrecognized tax benefits
810

615

Accrued penalties on unrecognized tax benefits
158

118

Reasonably possible reduction to the balance of unrecognized tax benefits
in succeeding 12 months
0-1,100

0-600

Portion that, if recognized, would reduce tax expense and effective tax rate(a)
0-900

0-500

(a)
Some portion of such reduction may be reported as discontinued operations.
Unrecognized Tax Benefits Reconciliation
UNRECOGNIZED TAX BENEFITS RECONCILIATION
 
 
 
(In millions)
2017

2016

 
 
 
Balance at January 1
$
4,692

$
6,778

Additions for tax positions of the current year
260

248

Additions for tax positions of prior years(a)
791

521

Reductions for tax positions of prior years
(113
)
(2,016
)
Settlements with tax authorities
(57
)
(823
)
Expiration of the statute of limitations
(124
)
(16
)
Balance at December 31
$
5,449

$
4,692

(a)
For 2017, the amount shown as “additions for tax positions of prior years” included $326 million related to uncertain tax liabilities acquired in the Baker Hughes transaction.
Components of Net Deferred Income Tax Asset (Liability)
Aggregated deferred income tax amounts are summarized below.
December 31 (In millions)
2017

2016

 
 
 
Assets
 
 
GE
$
15,586

$
21,106

GE Capital
6,176

5,093

 
21,762

26,199

Liabilities
 
 
GE
(10,382
)
(14,440
)
GE Capital
(5,177
)
(9,926
)
Eliminations
4

—

 
(15,555
)
(24,366
)
Net deferred income tax asset (liability)
$
6,207

$
1,833

COMPONENTS OF THE NET DEFERRED INCOME TAX ASSET (LIABILITY)
 
 
 
December 31 (In millions)
2017

2016

 
 
 
GE
 
 
Principal pension plans
$
3,911

$
8,963

Other non-current compensation and benefits
2,780

4,230

Provision for expenses
2,499

2,633

Retiree insurance plans
1,152

2,000

Non-U.S. loss carryforwards(a)
2,078

1,444

U.S. credit carryforwards(b)
1,932

67

Contract assets
(5,051
)
(6,677
)
Intangible assets
(2,033
)
(2,962
)
Depreciation
(1,022
)
(1,755
)
Other – net
(1,042
)
(1,277
)
 
5,204

6,666

GE Capital
 
 
Operating leases
(2,689
)
(3,582
)
Financing leases
(877
)
(1,632
)
Energy investments
(754
)
(1,410
)
Intangible assets
(25
)
(125
)
U.S. credit carryforwards(b)
1,632

1,092

Insurance company loss reserves
1,373

(819
)
Non-U.S. loss carryforwards(a)
1,271

1,323

Other – net
1,068

320

 
999

(4,833
)
Eliminations
4

—

Net deferred income tax asset (liability)
$
6,207

$
1,833

(a)
Net of valuation allowances of $4,251 million and $2,450 million for GE and $448 million and $391 million for GE Capital, for 2017 and 2016, respectively. Of the net deferred tax asset as of December 31, 2017 of $3,349 million, $11 million relates to net operating loss carryforwards that expire in various years ending from December 31, 2018 through December 31, 2020; $342 million relates to net operating losses that expire in various years ending from December 31, 2021 through December 31, 2037 and $2,996 million relates to net operating loss carryforwards that may be carried forward indefinitely.
(b)
Of the net deferred tax asset as of December 31, 2017 of $3,564 million for U.S. credit carryforwards, $1,194 million expires in the year ending December 31, 2027, $67 million expires in the years ending December 31, 2030 through 2032 and $2,303 million expires in various years ending from December 31, 2033 through December 31, 2037.