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INCOME TAXES
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
The components of loss before income taxes were as follows:
Year Ended December 31,
(in millions)202420232022
United States$(307)$(6)$(531)
Foreign(629)(169)(524)
Total loss before income taxes
$(936)$(175)$(1,055)

The components of the benefit for income taxes from operations were as follows:
Year Ended December 31,
(in millions)202420232022
Current:   
U.S. federal$(6)$1 $1 
U.S. state1 — 4 
Foreign115 86 118 
Total$110 $87 $123 
Deferred:   
U.S. federal$(61)$4 $(145)
U.S. state(1)(3)(17)
Foreign(74)(131)(66)
Total$(136)$(130)$(228)
Total benefit for income taxes
$(26)$(43)$(105)

The reconciliation of the U.S. federal statutory tax rate to the effective rate were as follows:
Year Ended December 31,
(in millions, except percentages)
202420232022
Statutory U.S. federal income tax rate$(197)21.0 %$(37)21.0 %$(222)21.0 %
Effect of:
State income taxes, net of federal benefit— — (2)1.4 (11)1.0 
Federal benefit of R&D and foreign tax credits(7)0.8 (17)10.0 (8)0.8 
U.S. other permanent differences3 (0.3)5 (2.7)9 (0.9)
Tax effect of international operations42 (4.5)(65)37.2 (5)0.5 
Global Intangible Low Taxed Income (GILTI)9 (1.0)12 (7.0)20 (1.9)
Foreign Derived Intangible Income (FDII)— — (9)5.2 (8)0.8 
Net effect of tax audit activity23 (2.5)(6)3.2 15 (1.4)
Tax effect of enacted statutory rate changes on Non-U.S. jurisdictions3 (0.3)1 (0.4)(3)0.3 
Federal tax on unremitted earnings of certain foreign subsidiaries(1)0.1 2 (0.9)1 (0.1)
Valuation allowance adjustments(13)1.3 5 (3.2)(9)0.8 
Tax effect of impairment of goodwill and intangibles106 (11.3)60 (34.6)114 (10.8)
Other6 (0.5)8 (4.4)2 (0.2)
Effective income tax rate on operations$(26)2.8 %$(43)24.8 %$(105)9.9 %
The tax effect of significant temporary differences giving rise to deferred tax assets and liabilities were as follows:
Year Ended December 31,
 (in millions)20242023
Deferred tax assets
Employee benefit accruals$40 $55 
Inventory19 15 
Miscellaneous accruals50 51 
Other44 44 
Lease right-of-use liability39 46 
Net unrealized gains/losses included in AOCI
— 36 
Foreign tax credit and R&D carryforward41 43 
Tax loss carryforwards and other tax attributes1,554 948 
Total deferred tax assets$1,787 $1,238 
Less: Valuation allowances(1,503)(863)
Total deferred tax assets, net$284 $375 
Deferred tax liabilities
Identifiable intangible assets$(110)$(298)
Property, plant and equipment(28)(38)
Lease right-of-use asset(38)(46)
Net unrealized gains/losses included in AOCI(9)— 
Taxes on unremitted earnings of foreign subsidiaries(6)(8)
Total deferred tax liabilities(191)(390)
Net deferred tax assets (liabilities)$93 $(15)

Deferred tax assets and liabilities included in the following Consolidated Balance Sheets line items at December 31 were as follows:
Year Ended December 31,
(in millions)20242023
Assets
Other noncurrent assets$222 $213 
Liabilities
Deferred income taxes$129 $228 

The Company has $36 million of foreign tax credit carryforwards at December 31, 2024, of which $30 million will expire in 2025 and $6 million will expire at various times from 2028 through 2031.

The Company has tax loss carryforwards related to certain foreign and domestic subsidiaries of approximately $7,482 million at December 31, 2024, of which $7,214 million expires at various times through 2044 and $268 million may be carried forward indefinitely. These are reflected as deferred income tax assets at December 31, 2024, and are comprised of future tax benefits of $1,458 million and $96 million, before valuation allowances, related to tax loss carryforwards and disallowed interest carryforwards, respectively. As of December 31, 2023 the Company’s deferred tax assets included $873 million of tax loss carryforwards and $74 million of disallowed interest carryforwards. The increase in tax loss carryforwards in 2024 is primarily the result of impairment losses.

At December 31, 2024, the Company has recorded $1,395 million of valuation allowance to offset the future tax benefit of net operating losses, $29 million to offset the future tax benefit of foreign tax credits, and $79 million of valuation allowance for other deferred tax assets. The Company has recorded these valuation allowances due to the uncertainty that these assets can be realized in the future. The increase in the valuation allowance is attributable to the increase in the tax loss carryforwards generated in 2024 as there is uncertainty that these assets can be realized in the future.
The Company has recorded $6 million of withholding taxes on certain undistributed earnings of its foreign subsidiaries that the Company anticipates will be repatriated. Undistributed earnings of foreign subsidiaries and related companies that are considered to be permanently invested amounted to $348 million at December 31, 2024.

Tax Contingencies

The total amount of gross unrecognized tax benefits at December 31, 2024 is approximately $137 million, including interest, of which approximately $51 million represents the amount of unrecognized tax benefits that, if recognized, would affect the effective income tax rate. It is reasonably possible that certain amounts of unrecognized tax benefits will significantly increase or decrease within twelve months of the reporting date of the Company’s consolidated financial statements. Expiration of statutes of limitations in various jurisdictions during the next twelve months could include unrecognized tax benefits of approximately $6 million, which, if recognized, would affect the effective income tax rate.

The total amount of accrued interest and penalties were $9 million and $4 million at December 31, 2024 and 2023, respectively. The Company has consistently classified interest and penalties recognized in its consolidated financial statements as income taxes based on the accounting policy election of the Company. The Company recognized a tax expense of $5 million for the year ended December 31, 2024, and a tax benefit of $2 million in 2023 related to interest and penalties.

The increase in unrecognized tax benefits in 2024 is primarily related to transfer pricing adjustments in certain jurisdictions, offset by a decrease from foreign currency translation.

The Company is subject to U.S. federal income tax as well as income tax of multiple state and foreign jurisdictions. The significant jurisdictions include the United States and Germany. The Company has concluded all U.S. federal income tax matters for years through 2014 with the Internal Revenue Service (“IRS”). The Company is currently under IRS audit for the tax years 2015 and 2016. The Company is under audit in Germany for the tax years 2014 through 2021. For additional information on the IRS and German audits, see Note 21, Commitments and Contingencies.

The activity recorded for unrecognized tax benefits were as follows:
Year Ended December 31,
(in millions) 202420232022
Unrecognized tax benefits at beginning of period$132 $49 $34 
Gross change for prior-period positions18 1 12 
Gross change for current year positions1 95 4 
Decrease due to settlements and payments(13)(9)— 
Decrease due to statute expirations— (4)— 
Increase due to effect of foreign currency translation— — — 
Decrease due to effect from foreign currency translation and other(10)— (1)
Unrecognized tax benefits at end of period$128 $132 $49