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Income Taxes
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The provision for income taxes consists of the following:
Year Ended December 31,
202320222021
Current
Federal$— $— $— 
State45 137 35 
Foreign43 61 12 
Current income tax provision88 198 47 
Deferred
Federal77 622 309 
State47 (22)78 
Foreign67 82 (9)
Deferred income tax provision191 682 378 
Provision for income taxes$279 $880 $425 
Income before income taxes is comprised of the following:
Year Ended December 31,
202320222021
United States (U.S.)$1,418 $3,114 $1,529 
Foreign496 522 179 
Income before income taxes
$1,914 $3,636 $1,708 

Deferred income tax assets, net is comprised of the following:
As of December 31,
20232022
Deferred income tax assets:
Net tax loss carryforwards $1,373 $1,109 
Long-term operating lease liabilities703 666 
Accrued liabilities and deferred revenue169 231 
Tax credits323 38 
Depreciation and amortization22 25 
Provision for doubtful accounts18 19 
Other213 167 
Valuation allowance (a)
(103)(101)
Deferred income tax assets2,718 2,154 
Deferred income tax liabilities:
Operating lease right-of-use assets693 657 
Depreciation and amortization117 90 
Prepaid expenses33 24 
Other7 4 
Deferred income tax liabilities850 775 
Deferred income tax assets, net$1,868 $1,379 
__________
(a)    The valuation allowance at December 31, 2023 relates to tax loss carryforwards and certain deferred tax assets of $100 million and $3 million, respectively. The valuation allowance at December 31, 2022 relates to tax loss carryforwards and certain deferred tax assets of $97 million and $4 million, respectively. The valuation allowances will be reduced when and if we determine it is more likely than not that the related deferred income tax assets will be realized.

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

As of December 31,
20232022
Deferred income tax assets:
Depreciation and amortization$80 $63 
Other28 22 
Deferred income tax assets108 85 
Deferred income tax liabilities:
Depreciation and amortization3,497 2,815 
Other29 24 
Deferred income tax liabilities3,526 2,839 
Deferred income tax liabilities under vehicle programs, net$3,418 $2,754 
At December 31, 2023, we had U.S. federal net operating loss carryforwards of approximately $4.9 billion. The majority of the net operating loss carryforwards have an indefinite utilization period pursuant to the Tax Act and a significant remaining portion expires by 2031. Such net operating loss carryforwards are primarily related to accelerated depreciation of our U.S. vehicles. Currently, we do not record valuation allowances on the majority of our U.S. federal tax loss carryforwards as there are adequate deferred tax liabilities that could be realized within the carryforward period. At December 31, 2023, we had foreign net operating loss carryforwards of approximately $1.0 billion, the majority of which has an indefinite utilization period.
At December 31, 2023, we had undistributed earnings of certain foreign subsidiaries of approximately $1.6 billion that we have indefinitely reinvested, and on which we have not recognized deferred taxes. Estimating the amount of potential tax is not practicable because of the complexity and variety of assumptions necessary to compute the tax.
The reconciliation between the U.S. federal income tax statutory rate and our effective income tax rate is as follows:
Year Ended December 31,
202320222021
U.S. federal statutory rate21.0 %21.0 %21.0 %
Adjustments to reconcile to the effective rate:
State and local income taxes, net of federal tax benefits4.0 3.9 5.5 
Changes in valuation allowances — (1.3)(0.6)
Taxes on foreign operations at rates different than U.S. federal statutory rates2.8 1.2 (2.0)
Tax credits (a)
(11.7)(0.4)— 
Stock-based compensation(1.1)(0.5)(0.3)
Other non-deductible (non-taxable) items0.7 0.4 0.6 
Other (a)
(1.1)(0.1)0.7 
14.6 %24.2 %24.9 %
_______
(a)For the year ended December 31, 2022, we reclassified (0.4%) of certain tax credits to conform to the current year presentation. This reclassification had no impact to our reported effective income tax rate.
The following is a tabular reconciliation of the gross amount of unrecognized tax benefits for the year:
202320222021
Balance, January 1$53 $58 $57 
Additions for tax positions related to current year5 4 4 
Additions for tax positions for prior years5 3 3 
Reductions for tax positions for prior years— (5)(3)
Settlements— (5)— 
Statute of limitations(2)— — 
Foreign currency translation2 (2)(3)
Balance, December 31$63 $53 $58 
We do not anticipate that total unrecognized tax benefits will change significantly in 2024.
We are subject to taxation in the United States and various foreign jurisdictions. As of December 31, 2023, the 2007 through 2022 tax years generally remain subject to examination by the federal tax authorities. The 2012 through 2022 tax years generally remain subject to examination by various state tax authorities. In significant foreign jurisdictions, the 2012 through 2022 tax years generally remain subject to examination by their respective tax authorities.
Substantially all of the gross amount of the unrecognized tax benefits at December 31, 2023, 2022 and 2021, if recognized, would affect our provision for income taxes. As of December 31, 2023, our unrecognized tax benefits were offset by tax loss carryforwards and other deferred tax assets in the amount of $28 million.
The following table presents unrecognized tax benefits:
As of December 31,
20232022
Unrecognized tax benefits in current income taxes payable (a)
$17 $— 
Unrecognized tax benefits in non-current income taxes payable (a)
21 33 
Accrued interest payable on potential tax liabilities (b)
44 31 
__________
(a)Pursuant to the agreements governing the disposition of certain subsidiaries in 2006, we are entitled to indemnification for certain predisposition tax contingencies. As of December 31, 2023, $17 million of unrecognized tax benefits in current income taxes payable are related to tax contingencies which we believe we are entitled to indemnification. As of December 31, 2022, $13 million unrecognized tax benefits in non-current income taxes payable are related to tax contingencies for which we believe we are entitled to indemnification.
(b)We recognize 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, 2023, 2022 and 2021, were not significant and were recognized as a component of the provision for income taxes.