SPECIAL ITEMS

In 2018, the Company recognized special items of $87 million for merger-related costs associated with its acquisition of Virgin America. Costs classified as merger-related are directly attributable to merger activities.

The Company incurred a one-time settlement fee of $20 million for the termination of an existing maintenance services agreement and subsequently entered into a new services agreement that provides more flexibility for the timing and scope of engine work. Additionally, the Company incurred $25 million for one-time bonuses paid to employees as a result of tax reform. These charges were recognized as special charges and are included in the Special charges - other line on our consolidated statements of operations.

In 2017, the Company recognized $116 million in merger-related costs. The Company also recognized a special tax benefit of $237 million due to the remeasurement of net deferred tax liabilities as a result of the Tax Cuts and Jobs Act signed into law on December 22, 2017, partially offset by certain state tax law enactments.

In 2016, the Company recognized $117 million in merger-related costs. $39 million of these costs were not deductible under the U.S. federal tax law, as discussed in Note 7. The Company recognized a special tax expense of $17 million representing the discrete impacts of adjustments to the Company's position on income sourcing in various states.

The following breaks down merger-related costs incurred in 2018, 2017 and 2016 (in millions):



	2018		2017		2016
Consulting and professional services	$	45	$	52	$	32
Employee-related costs^(a)	13		41		22
Banking fees	—		—		36
Legal and accounting fees	1		3		22
Other merger-related costs^(b)	28		20		5
Total Merger-related Costs	$	87	$	116	$	117


(a)	Employee-related costs consist primarily of severance, retention bonuses, and training and skill development.


(b)	Other merger-related costs consist primarily of costs for marketing and advertising, IT, employee appreciation and company sponsored events, moving expenses, supplies, and other immaterial expenses.