13. Income Taxes

The following summarizes income tax expense (benefit) and effective tax rates:



	Three Months Ended September 30,						Nine Months Ended September 30,
millions except percentages	2015			2014			2015			2014
Income tax expense (benefit)	$	(917	)	$	627		$	(2,232	)	$	1,719
Income (loss) before income taxes	(3,077		)	1,774			(7,520		)	506
Effective tax rate	30		%	35		%	30		%	340		%

The Company reported a loss before income taxes for the three and nine months ended September 30, 2015. As a result, items that ordinarily increase or decrease the tax rate will have the opposite effect. The decrease from the 35% U.S. federal statutory rate for the three and nine months ended September 30, 2015, was primarily attributable to Algerian exceptional profits taxes and the tax impact from foreign operations.

For the three months ended September 30, 2014, the Company’s effective tax rate was the same as the 35% U.S. federal statutory rate. The effective tax rate increase related to the Algerian exceptional profits taxes was offset by the tax impact from foreign operations. The increase from the 35% U.S. federal statutory rate for the nine months ended September 30, 2014, was primarily attributable to net changes in uncertain tax positions related to the settlement agreement associated with the Tronox Adversary Proceeding, the tax impact from foreign operations, Algerian exceptional profits taxes, and the non-deductible contingent CWA-penalty accrual.

At September 30, 2015, the Company had recorded a $577 million tax benefit related to the Tronox settlement. This benefit was net of a $1.3 billion uncertain tax position due to the uncertainty related to the deductibility of the settlement payment. The Company is a participant in the U.S. Internal Revenue Service’s (IRS) Compliance Assurance Process and has regular discussions with the IRS concerning the Company’s tax positions. Depending on the outcome of such discussions, it is reasonably possible that the amount of the uncertain tax position related to the settlement could change, perhaps materially. See Note 12—Contingencies—Tronox Litigation.

At September 30, 2015, the Company’s Consolidated Balance Sheet included $959 million of income taxes receivable presented in accounts receivable—others.