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Equipment Installment Plans (Table)

12 Months Ended

Dec. 31, 2022

The following table summarizes equipment installment plan receivables.


December 31,	2022		2021
(Dollars in millions)
Equipment installment plan receivables, gross	$	1,211	$	1,085


Allowance for credit losses	(96)		(72)
Equipment installment plan receivables, net	$	1,115	$	1,013

Net balance presented in the Consolidated Balance Sheet as:
Accounts receivable — Customers and agents (Current portion)	$	646	$	639
Other assets and deferred charges (Non-current portion)	469		374
Equipment installment plan receivables, net	$	1,115	$	1,013

Equipment installment plan receivables credit categories

The balance and aging of the equipment installment plan receivables on a gross basis by credit category were as follows:


	December 31, 2022										December 31, 2021
	Lowest Risk		Lower Risk		Slight Risk		Higher Risk		Total		Lowest Risk		Lower Risk		Slight Risk		Higher Risk		Total
(Dollars in millions)
Unbilled	$	1,016	$	98	$	22	$	5	$	1,141	$	896	$	94	$	24	$	5	$	1,019
Billed — current	41		5		2		—		48		40		5		1		1		47
Billed — past due	13		6		2		1		22		10		6		2		1		19
Total	$	1,070	$	109	$	26	$	6	$	1,211	$	946	$	105	$	27	$	7	$	1,085

The balance of the equipment installment plan receivables as of December 31, 2022 on a gross basis by year of origination were as follows:


	2020		2021		2022		Total
(Dollars in millions)
Lowest Risk	$	43	$	303	$	724	$	1,070
Lower Risk	3		28		78		109
Slight Risk	—		4		22		26
Higher Risk	—		1		5		6
Total	$	46	$	336	$	829	$	1,211

Equipment installment plans allowance for credit losses

Activity for the years ended December 31, 2022 and 2021, in the allowance for credit losses for equipment installment plan receivables was as follows:


	2022		2021
(Dollars in millions)
Allowance for credit losses, beginning of year	$	72	$	78
Bad debts expense	100		38
Write-offs, net of recoveries1	(76)		(44)
Allowance for credit losses, end of year	$	96	$	72

1Write-offs increased in 2022 as customer payment behavior returned to pre-COVID-19 pandemic levels.