Income Taxes (Tables)

12 Months Ended

Dec. 31, 2015

Components of the (provision)/benefit for income taxes on continuing operations

The components of the benefit (provision) for income taxes on continuing operations were:



	Year Ended December 31
Millions of dollars	2015			2014			2013
Current income taxes:
Federal	$	635		$	(959	)	$	(245	)
Foreign	(636		)	(734		)	(485		)
State	51			(36		)	(49		)
Total current	50			(1,729		)	(779		)
Deferred income taxes:
Federal	(18		)	83			4
Foreign	262			357			125
State	(20		)	14			2
Total deferred	224			454			131
Income tax benefit (provision)	$	274		$	(1,275	)	$	(648	)

United States and foreign components of income from continuing operations before income taxes

The United States and foreign components of income (loss) from continuing operations before income taxes were as follows:



	Year Ended December 31
Millions of dollars	2015			2014		2013
United States	$	(1,560	)	$	3,020	$	1,070
Foreign	624			1,692		1,694
Total	$	(936	)	$	4,712	$	2,764

Reconciliations between the actual provision for income taxes on continuing operations and that computed by applying the US statutory rate to income from continuing operations before income taxes

Reconciliations between the actual provision for income taxes on continuing operations and that computed by applying the United States statutory rate to income (loss) from continuing operations before income taxes were as follows:



	Year Ended December 31
	2015		2014		2013
United States statutory rate	35.0	%	35.0	%	35.0	%
Impact of foreign income taxed at different rates	(15.6	)	(5.7	)	(9.3	)
Venezuela devaluation	4.3		—		—
Valuation allowance against tax assets	3.5		(3.6	)	(0.1	)
Impact of impairments and other charges	(3.0	)	—		—
Non-deductible acquisition costs	2.6		—		—
Adjustments of prior year taxes	(0.7	)	0.3		(0.6	)
Other impact of foreign operations	(0.5	)	(0.1	)	(0.7	)
State income taxes	0.3		0.8		1.7
Domestic manufacturing deduction	—		(1.9	)	(2.0	)
Other items, net	3.4		2.3		(0.5	)
Total effective tax rate on continuing operations	29.3	%	27.1	%	23.5	%

Primary components of deferred tax assets and liabilities

The primary components of our deferred tax assets and liabilities were as follows:



	December 31
Millions of dollars	2015		2014
Gross deferred tax assets:
Accrued liabilities	$	392	$	494
Net operating loss carryforwards	540		462
Employee compensation and benefits	403		395
Foreign tax credit carry forward	365		79
Other	354		236
Total gross deferred tax assets	2,054		1,666
Gross deferred tax liabilities:
Depreciation and amortization	1,334		1,005
Other	109		111
Total gross deferred tax liabilities	1,443		1,116
Valuation allowances	213		184
Net deferred income tax asset	$	398	$	366

Rollforward of unrecognized tax benefits and associated interest and penalties

The following table presents a rollforward of our unrecognized tax benefits and associated interest and penalties.



Millions of dollars	Unrecognized Tax Benefits				Interest and Penalties
Balance at January 1, 2013	$	228			$	68
Change in prior year tax positions	(53		)		(9		)
Change in current year tax positions	30				1
Cash settlements with taxing authorities	(21		)		(17		)
Lapse of statute of limitations	(9		)		(9		)
Balance at December 31, 2013	$	175			$	34
Change in prior year tax positions	83				24
Change in current year tax positions	84				—
Cash settlements with taxing authorities	(27		)		(1		)
Lapse of statute of limitations	(1		)		(1		)
Balance at December 31, 2014	$	314		(a)	$	56
Change in prior year tax positions	(33		)		7
Change in current year tax positions	62				1
Cash settlements with taxing authorities	(16		)		(15		)
Lapse of statute of limitations	(5		)		(2		)
Balance at December 31, 2015	$	322		(a)(b)	$	47

(a)

Includes $67 million as of December 31, 2015 and $46 million as of December 31, 2014 in foreign unrecognized tax benefits that would give rise to a United States tax credit. Approximately $176 million, which excludes $10 million of unrecognized tax benefits covered by an indemnification asset, as of December 31, 2015 and $194 million as of December 31, 2014, if resolved in our favor, would positively impact the effective tax rate and, therefore, be recognized as additional tax benefits in our statement of operations.


(b)	Includes $37 million that could be resolved within the next 12 months.