
	Year ended September 30,
$ in millions	2020		2019		2018
Recorded in:
Net income (1)	$	234	$	341	$	454
Equity, arising from available-for-sale securities recorded through OCI	23		27		(19)
Equity, arising from currency translations, net of the impact of net investment hedges recorded through OCI	2		7		10
Equity, arising from cash flow hedges recorded through OCI	(12)		(23)		15
Total provision for income taxes	$	247	$	352	$	460

(1) Our provision for income taxes for the year ended September 30, 2018 included $105 million related to the enactment of the Tax Cuts and Jobs Act (“Tax Act”) in December 2017, primarily due to the remeasurement of U.S. deferred tax assets at a lower enacted federal corporate tax rate.


	Year ended September 30,
$ in millions	2020		2019		2018
Current:
Federal	$	215	$	286	$	258
State and local	49		63		65
Foreign	9		15		14
Total current	273		364		337
Deferred:
Federal	(36)		(22)		121
State and local	(3)		(1)		(4)

Total deferred	(39)		(23)		117
Total provision for income taxes	$	234	$	341	$	454


	Year ended September 30,
	2020		2019		2018
Provision calculated at statutory rate	21.0	%	21.0	%	24.5	%
Impact of Tax Act	—		0.1	%	8.1	%
State income tax, net of federal benefit	3.6	%	3.6	%	3.9	%
Excess tax benefits related to share-based compensation	(0.6)	%	(0.4)	%	(0.9)	%
Gains on company-owned life insurance policies which are not subject to tax	(1.0)	%	(0.1)	%	(0.7)	%
Federal tax credits	(1.1)	%	(0.9)	%	(0.7)	%


Other, net	0.3	%	1.5	%	0.6	%
Total provision for income tax	22.2	%	24.8	%	34.8	%

Our U.S. federal statutory tax rate for the year ended September 30, 2018 of 24.5% reflected a blended federal statutory rate of 35.0% for our first fiscal quarter and 21.0% for the remaining three fiscal quarters as a result of the Tax Act.

The cumulative effects of temporary differences that give rise to significant portions of the deferred tax asset/(liability) items are detailed in the following table.


	September 30,
$ in millions	2020		2019
Deferred tax assets:
Deferred compensation	$	229	$	192
Allowances for loan losses and reserves for unfunded commitments	89		56
Unrealized loss associated with foreign currency translations	8		10
Unrealized loss associated with cash flow hedges	18		6
Accrued expenses	34		35
Partnership investments	13		12
Lease liabilities	80		—
Other	16		12


Total deferred tax assets	487		323
Deferred tax liabilities:
Goodwill and identifiable intangible assets	(34)		(28)
Property and equipment	(81)		(57)
Lease ROU assets	(80)		—
Unrealized gain associated with available-for-sale securities	(30)		(7)

Total deferred tax liabilities	(225)		(92)
Net deferred tax assets	$	262	$	231

We had a net deferred tax asset at both September 30, 2020 and 2019. We believe that the realization of the net deferred tax asset of $262 million is more likely than not based on expectations of future taxable income.

As of September 30, 2020, we considered nearly all undistributed earnings of non-U.S. subsidiaries to be permanently reinvested. Therefore, we have not provided for any U.S. deferred income taxes related to such subsidiaries. As of September 30, 2020, we had approximately $311 million of cumulative undistributed earnings attributable to foreign subsidiaries, most of which were subject to U.S. tax under the transition tax on foreign earnings under the Tax Act. Because the time and manner of repatriation is uncertain, we cannot determine the impact of local taxes, withholding taxes and foreign tax credits associated with the future repatriation of such earnings, and therefore, cannot quantify the tax liability that would be payable in the event all such foreign earnings are repatriated.

As of September 30, 2020, the current tax receivable, which is included in “Other receivables” on our Consolidated Statements of Financial Condition, was $17 million, and the current tax payable, which is included in “Other payables,” was $82 million. As of September 30, 2019, the current tax receivable was $22 million and the current tax payable was $49 million.

We recognize the accrual of interest and penalties related to income tax matters in interest expense and other expense, respectively. As of September 30, 2020 and 2019, accrued interest and penalties were approximately $8 million and $6 million, respectively.


	Year ended September 30,
$ in millions	2020		2019		2018
Uncertain tax positions beginning of year	$	42	$	31	$	20
Increases for tax positions related to the current year	5		11		5
Increases for tax positions related to prior years	3		7		10
Decreases for tax positions related to prior years	(1)		—		(1)
Decreases due to lapsed statute of limitations	(4)		(2)		(3)
Decreases related to settlements	—		(5)		—
Uncertain tax positions end of year	$	45	$	42	$	31

The total amount of uncertain tax positions that, if recognized, would impact the effective tax rate (the items included in the preceding table after considering the federal tax benefit associated with any state tax provisions) was $40 million, $38 million, and $27 million at September 30, 2020, 2019 and 2018, respectively. We anticipate that the uncertain tax position liability balance will decrease by approximately $8 million over the next 12 months due to the expiration of statutes of limitations on federal and state tax returns and settlements of positions with the IRS.

We file U.S. federal income tax returns as well as returns with various state, local and foreign jurisdictions. With few exceptions, we are generally no longer subject to U.S. federal, state and local, or foreign income tax examination by tax authorities for years prior to fiscal year 2017 for federal tax returns, fiscal year 2016 for state and local tax returns and fiscal year 2016 for foreign tax returns. Various foreign and state audits in process are expected to be completed in fiscal year 2021.