Income Taxes (Tables)

12 Months Ended

Dec. 31, 2012

Provision for Income Taxes

Our “Provision for income taxes” consisted of the following (in millions):

	Years Ended December 31,
	2012		2011		2010
Current:
Federal	$	268	$	240	$	354
State		72		38		99
Foreign		36		35		22
		376		313		475
Deferred:
Federal		48		162		85
State		17		36		64
Foreign		2		—		5
		67		198		154
Provision for income taxes	$	443	$	511	$	629

U.S. Federal Statutory Income Tax Rate Reconciled to Effective Rate

The U.S. federal statutory income tax rate is reconciled to the effective rate as follows:

	Years Ended December 31,
	2012			2011			2010
Income tax expense at U.S. federal statutory rate		35.00	%		35.00	%		35.00	%
State and local income taxes, net of federal income tax benefit		3.85			3.46			4.50
Miscellaneous federal tax credits		(4.13	)		(3.29	)		(1.67	)
Noncontrolling interests		(1.16	)		(1.11	)		(1.05	)
Taxing authority audit settlements and other tax adjustments		(0.02)			(0.47	)		0.54
Nondeductible costs relating to acquired intangibles		0.06			0.08			0.11
Tax rate differential on foreign income		(0.96	)		(0.70	)		(0.39	)
Cumulative effect of change in tax rates		0.18			0.12			1.74
Other		1.13			0.52			(0.25	)
Provision for income taxes		33.95	%		33.61	%		38.53	%

Income Before Income Taxes Showing Domestic and Foreign Sources

For financial reporting purposes, income before income taxes showing domestic and foreign sources was as follows (in millions) for the years ended December 31, 2012, 2011 and 2010:

	Years Ended December 31,
	2012		2011		2010
Domestic	$	1,175	$	1,394	$	1,517
Foreign		128		126		114
Income before income taxes	$	1,303	$	1,520	$	1,631

Components of Net Deferred Tax Assets (Liabilities)

The components of the net deferred tax assets (liabilities) at December 31 are as follows (in millions):

December 31,
	2012			2011
Deferred tax assets:
Net operating loss, capital loss and tax credit carry-forwards	$	189		$	175
Landfill and environmental remediation liabilities		—			17
Miscellaneous and other reserves, net		301			286
Subtotal		490			478
Valuation allowance		(120	)		(100	)
Deferred tax liabilities:
Landfill and environmental remediation liabilities		(11	)		—
Property and equipment		(1,180	)		(1,204	)
Goodwill and other intangibles		(1,050	)		(980	)
Net deferred tax liabilities	$	(1,871	)	$	(1,806	)

Reconciliation of Beginning and Ending Amount of Gross Unrecognized Tax Benefits, Including Accrued interest

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits, including accrued interest for 2012, 2011 and 2010 is as follows (in millions):

	2012			2011			2010
Balance at January 1	$	49		$	53		$	75
Additions based on tax positions related to the current year		15			9			5
Additions based on tax positions of prior years		—			—			—
Additions due to acquisitions		—			2			—
Accrued interest		2			2			3
Reductions for tax positions of prior years		(1	)		—			(1	)
Settlements		(4	)		(10	)		(23	)
Lapse of statute of limitations		(7	)		(7	)		(6	)
Balance at December 31	$	54		$	49		$	53