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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2011

Components Of Earnings From Continuing Operations Before Income Taxes And Equity Earnings By Taxing Jurisdiction


In millions	2011		2010		2009
Earnings (loss)
U.S.	$	874	$	198	$	905
Non-U.S.		584		624		294
Earnings (loss) from continuing operations before income taxes and equity earnings	$	1,458	$	822	$	1,199

Provision (Benefit) For Income Taxes By Taxing Jurisdiction


In millions	2011			2010			2009
Current tax provision (benefit)
U.S. federal	$	(78	)	$	(249	)	$	228
U.S. state and local		(19	)		(19	)		7
Non-U.S.		91			67			74
	$	(6	)	$	(201	)	$	309
Deferred tax provision (benefit)
U.S. federal	$	207		$	301		$	(63	)
U.S. state and local		46			45			41
Non-U.S.		64			76			182
	$	317		$	422		$	160
Income tax provision	$	311		$	221		$	469

Reconciliation Of Income Tax Expense Using Statutory U.S. Income Tax Rate Compared With Actual Income Tax Provision


In millions	2011			2010			2009
Earnings (loss) from continuing operations before income taxes and equity earnings	$	1,458		$	822		$	1,199
Statutory U.S. income tax rate		35	%		35	%		35	%
Tax expense (benefit) using statutory U.S. income tax rate		510			288			420
State and local income taxes		16			15			32
Tax rate and permanent differences on non-U.S. earnings		(34	)		(69	)		162
Net U.S. tax on non-U.S. dividends		23			16			11
Tax benefit on manufacturing activities		(8	)		3			(2	)
Non-deductible business expenses		6			8			7
Sales of non-strategic businesses		(195	)		0			0
Retirement plan dividends		(5	)		(2	)		(2	)
Alternative fuel mixture credits		0			0			(133	)
Cellulosic bio-fuel credits		0			(40	)		0
Tax credits		(7	)		(25	)		(11	)
Medicare subsidy		0			29			(7	)
Tax audits		0			0			(16	)
Other, net		5			(2	)		8
Income tax provision	$	311		$	221		$	469
Effective income tax rate		21	%		27	%		39	%

Tax Effects Of Significant Temporary Differences, Representing Deferred Tax Assets And Liabilities


In millions	2011			2010
Deferred tax assets:
Postretirement benefit accruals	$	242		$	256
Pension obligations		954			616
Alternative minimum and other tax credits		478			416
Net operating loss carryforwards		536			541
Compensation reserves		189			185
Other		173			268
Gross deferred tax assets		2,572			2,282
Less: valuation allowance		(424	)		(366	)
Net deferred tax assets	$	2,148		$	1,916
Deferred tax liabilities:
Plants, properties and equipment	$	(2,383	)	$	(2,174	)
Forestlands and related installment sales		(1,833	)		(2,061	)
Gross deferred tax liabilities	$	(4,216	)	$	(4,235	)
Net deferred tax liability	$	(2,068	)	$	(2,319	)

Reconciliation Of Beginning And Ending Amount Of Unrecognized Tax Benefits


In millions	2011			2010			2009
Balance at January 1	$	(199	)	$	(308	)	$	(435	)
Additions based on tax positions related to current year		(2	)		(12	)		(28	)
Additions for tax positions of prior years		(719	)		(50	)		(82	)
Reductions for tax positions of prior years		29			97			72
Settlements		2			0			174
Expiration of statutes of limitations		25			70			2
Currency translation adjustment		7			4			(11	)
Balance at December 31	$	(857	)	$	(199	)	$	(308	)

Components Of Net Provisions Related To Special Items


In millions	2011			2010			2009
Special items and other charges:
Restructuring and other charges	$	(293	)	$	(149	)	$	(534)
Alternative fuel mixture credit		0			0			650
Tax-related adjustments:
Internal restructurings		24			0			0
India deal costs		9			0			0
IP UK valuation allowance release		(13	)		0			0
Settlement of tax audits and legislative changes		5			0			(26	)
Incentive plan deferred tax write-off		0			14			0

Medicare D deferred tax write-off		0			32			0
Cellulosic bio-fuel credits		0			(40	)		0
Valuation allowance for Louisiana recycle credits		0			0			15
Valuation allowance for net deferred tax assets in France		0			0			156
Other tax adjustments		2			0			18
Income tax provision (benefit) related to special items	$	(266	)	$	(143	)	$	279

Scheduled Expiration Dates Of Net Operating Loss And Tax Credit Carryforwards


In millions	2012 Through 2021		2022 Through 2031		Indefinite		Total
U.S. federal and non-U.S. NOLs	$	15	$	414	$	344	$	773
State taxing jurisdiction NOLs		152		159		0		311
U.S. federal, non- U.S. and state tax credit carryforwards		166		81		371		618
State capital loss carryforwards		25		0		0		25
Total	$	358	$	654	$	715	$	1,727

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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