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Income Taxes
9 Months Ended
Oct. 31, 2020
Current Income Tax Expense (Benefit), Continuing Operations [Abstract]  
Income Taxes Income Taxes
The Company has historically calculated the provision for income taxes on the current estimate of the annual effective tax rate and adjusted as necessary for quarterly events. Due to the impacts of the COVID-19 pandemic, the income tax expense for the thirty-nine-weeks ended October 31, 2020 was computed on a year-to-date basis.
For the third quarter of 2020, the Company’s effective tax rate was 19.3% compared to 9.1% in the third quarter of 2019. The third quarter of 2020 rate was lower than the Company's combined estimated federal and state statutory rate primarily due to tax matters associated with foreign investments and recent changes in tax legislation, which resulted in a $23 million net tax benefit. The third quarter of 2019 rate was lower than the Company's combined federal and state statutory rate primarily due to the Victoria's Secret impairment charges, which generated no tax benefit for certain foreign subsidiaries.
For year-to-date 2020, the Company's effective tax rate was 74.8% compared to 0.4% year-to-date 2019. The year-to-date 2020 rate was higher than the Company's combined estimated federal and state statutory rate primarily due to the resolution of certain tax matters partially offset by foreign losses with no tax benefit. The impact of these items has a greater impact on the effective tax rate at lower levels of pre-tax loss. The year-to-date 2019 rate was lower than the Company's combined estimated federal and state statutory rate primarily due to the Victoria's Secret impairment charges, which generated no tax benefit for certain foreign subsidiaries.
Income taxes paid were $9 million and $27 million for the third quarter of 2020 and 2019, respectively. Income taxes paid were $31 million and $208 million for year-to-date 2020 and 2019, respectively.
Uncertain Tax Positions
The Company had unrecognized tax benefits of $88 million as of February 1, 2020, of which $81 million, if recognized, would reduce the effective income tax rate. Through October 31, 2020, the Company had a net decrease to gross unrecognized tax benefits of $29 million, primarily due to the resolution of certain tax matters. The changes to the unrecognized tax benefits resulted in a $28 million benefit to the Company’s year-to-date Provision for Income Taxes.
Of the total unrecognized tax benefits as of October 31, 2020, it is reasonably possible that $28 million could change in the next 12 months due to audit settlements, expiration of statute of limitations or other resolution of uncertainties. Due to the uncertain and complex application of tax regulations, it is possible that the ultimate resolution of audits may result in amounts which could be different from this estimate. In such case, the Company will record additional tax expense or tax benefit in the period in which such matters are effectively settled.