INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2020

The provision for income taxes consisted of the following for the years ended December 31, 2020, 2019 and 2018:


	2020		2019		2018
	(in millions)
Current provision:
Federal	$	1,019	$	560	$	139
States and Puerto Rico	93		41		58
Total current provision	1,112		601		197
Deferred expense	195		162		194
Provision for income taxes	$	1,307	$	763	$	391

Provision for Income Taxes Using Federal Statutory Rate

The provision for income taxes was different from the amount computed using the federal statutory rate for the years ended December 31, 2020, 2019 and 2018 due to the following:


	2020		2019		2018
	(in millions)
Income tax provision at federal statutory rate	$	982	$	729	$	436
States, net of federal benefit, and Puerto Rico	63		49		42
Tax exempt investment income	(5)		(6)		(11)
Health insurance industry fee	268		—		243
Nondeductible executive compensation	19		25		17
Tax reform	—		—		(39)
KMG sale	—		—		(272)
Other, net	(20)		(34)		(25)
Provision for income taxes	$	1,307	$	763	$	391

Principal Components of Net Deferred Tax Balances

Principal components of our net deferred tax balances at December 31, 2020 and 2019 were as follows:


	Assets (Liabilities)
	2020		2019
	(in millions)
Compensation and other accrued expense	$	171	$	111
Benefits payable	87		89
Net operating loss carryforward	32		42
Deferred acquisition costs	26		22
Unearned revenues	12		8
Other	11		8
Capital loss carryforward	—		1


Total deferred income tax assets	339		281
Valuation allowance	(37)		(45)
Total deferred income tax assets, net of valuation allowance	302		236
Depreciable property and intangible assets	(449)		(329)
Investment securities	(418)		(181)
Prepaid expenses	(91)		(64)
Future policy benefits payable	(3)		(3)
Total deferred income tax liabilities	(961)		(577)
Total net deferred income tax liabilities	$	(659)	$	(341)