Income Taxes

3 Months Ended

Mar. 31, 2012

Income Taxes [Abstract]

Income Taxes

NOTE 10 – INCOME TAXES

International Paper made income tax payments, net of refunds, as follows:

	Three Months Ended March  31,
In millions	2012		2011
Income tax payments (refunds)	$	5	$	(92	)

The following table presents a rollforward of unrecognized tax benefits and related accrued estimated interest and penalties for the three months ended March 31, 2012:

In millions	Unrecognized Tax Benefits			Accrued Estimated Interest and Tax Penalties
Balance at December 31, 2011	$	(857	)	$	(88	)
Activity for three months ended March 31, 2012		(119	)(a)		(10	)
Balance at March 31, 2012	$	(976	)	$	(98	)

(a) This activity primarily relates to the unrecognized tax benefits and related accrued interest and penalties assumed as part of the acquisition of Temple-Inland.

The Company currently estimates that, as a result of ongoing discussions, pending tax settlements and expirations of statutes of limitations, the amount of unrecognized tax benefits could be reduced by approximately $45 million during the next 12 months.

Included in the Company's income tax provisions for the three months ended March 31, 2012 and 2011, are $(27) million and $(10) million, respectively, related to special items. The components of the net provision related to special items were as follows:

	Three Months Ended March  31,
In millions	2012			2011
Special items and other charges:
Restructuring and other charges	$	(28	)	$	5
Tax-related adjustments:
Temple-Inland acquistion		3			0
Expired tax contingency reserves		0			(15	)
Income tax provision (benefit) related to special items and discontinued operations	$	(25	)	$	(10	)