Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Income Taxes [Line Items]

Provision for (Benefit From) Income Taxes

The provision for (benefit from) income taxes consists of the following:

		Year Ended December 31,
		2019			2018			2017
Current
	Federal	$	(3	)	$	(7	)	$	—
	State	41			36			5
	Foreign	50			59			37
	Current income tax provision	88			88			42
Deferred
	Federal	41			63			(205		)
	State	(37		)	(39		)	(5		)
	Foreign	(107		)	(10		)	18
	Deferred income tax provision	(103		)	14			(192		)
Provision for (benefit from) income taxes		$	(15	)	$	102		$	(150	)

Pretax Income (Loss) for Domestic and Foreign Operations

Pretax income for domestic and foreign operations consists of the following:

	Year Ended December 31,
	2019		2018		2017
United States	$	125	$	114	$	17
Foreign	162		153		194
Pretax income	$	287	$	267	$	211

Deferred Income Tax Assets and Liabilities

Deferred income tax assets and liabilities are comprised of the following:

		As of December 31,
		2019			2018
Deferred income tax assets:
	Net tax loss carryforwards	$	1,645		$	1,390
	Long-term operating lease liabilities	678			—
	Accrued liabilities and deferred revenue	236			230
	Tax credits	20			17
	Depreciation and amortization	17			16
	Provision for doubtful accounts	8			6
	Other	75			38
	Valuation allowance (a)	(214		)	(311		)
Deferred income tax assets		2,465			1,386
Deferred income tax liabilities:
	Operating lease right-of-use assets	672			—
	Depreciation and amortization	108			60
	Prepaid expenses	17			20
	Other	6			5
Deferred income tax liabilities		803			85
Deferred income tax assets, net		$	1,662		$	1,301

__________

^(a) 

The valuation allowance of $214 million at December 31, 2019 relates to tax loss carryforwards and certain deferred tax assets of $192 million and $22 million, respectively. The valuation allowance will be reduced when and if the Company determines it is more likely than not that the related deferred income tax assets will be realized. The valuation allowance of $311 million at December 31, 2018 relates to tax loss carryforwards and certain deferred tax assets of $283 million and $28 million, respectively. The valuation allowance will be reduced when and if the Company determines it is more likely than not that the related deferred income tax assets will be realized.

Reconciliation of U.S Federal Income Tax Statutory Rate and Effective Income Tax Rate

The reconciliation between the U.S. federal income tax statutory rate and the Company’s effective income tax rate is as follows:

		Year Ended December 31,
		2019		2018		2017
U.S. federal statutory rate		21.0	%	21.0	%	35.0	%
Adjustments to reconcile to the effective rate:
	State and local income taxes, net of federal tax benefits	(1.7	)	5.5		3.8
	Changes in valuation allowances	(26.9	)	6.3		(4.7	)
	Taxes on foreign operations at rates different than statutory U.S. federal rates	3.4		(5.2	)	(3.6	)
	Stock-based compensation	—		(0.8	)	(3.4	)
	Tax Act (benefit) expense	—		11.2		(100.8	)
	Other non-deductible (non-taxable) items	(1.4	)	1.1		2.2
	Other	0.4		(0.9	)	0.4
		(5.2	)%	38.2	%	(71.1	)%

Changes in Gross Unrecognized Tax Benefits

The following is a tabular reconciliation of the gross amount of unrecognized tax benefits for the year:

		2019			2018			2017
Balance, January 1		$	61		$	63		$	59
	Additions for tax positions related to current year	6			8			6
	Additions for tax positions for prior years	—			—			9
	Reductions for tax positions for prior years	(8		)	(6		)	(10		)
	Settlements	(4		)	(3		)	—
	Statute of limitations	(1		)	(1		)	(1		)
Balance, December 31		$	54		$	61		$	63

Unrecognized Tax Benefits

The following table presents unrecognized tax benefits: 

	As of December 31,
	2019		2018
Unrecognized tax benefit in non-current income taxes payable (a)	$	57	$	41
Accrued interest payable on potential tax liabilities (b)	27		29

__________

^(a)  Pursuant to the agreements governing the disposition of certain subsidiaries in 2006, the Company is entitled to indemnification for certain pre-disposition tax contingencies. As of December 31, 2019 and 2018, $13 million, respectively, of unrecognized tax benefits are related to tax contingencies for which the Company believes it is entitled to indemnification.

^(b)  The Company recognizes potential interest related to unrecognized tax benefits within interest expense related to corporate debt, net on the accompanying Consolidated Statements of Operations. Penalties incurred during the years ended December 31, 2019, 2018 and 2017, were not significant and were recognized as a component of the provision for income taxes.

Vehicle Programs

Income Taxes [Line Items]

Deferred Income Tax Assets and Liabilities

Deferred income tax assets and liabilities related to vehicle programs are comprised of the following: 

	As of December 31,
	2019		2018
Deferred income tax assets:
Depreciation and amortization	$	54	$	44
Other	48		—
Deferred income tax assets	102		44
Deferred income tax liabilities:
Depreciation and amortization	2,243		2,005
Other	48		—
Deferred income tax liabilities	2,291		2,005
Deferred income tax liabilities under vehicle programs, net	$	2,189	$	1,961