Income Taxes (Tables)

12 Months Ended

Jul. 26, 2014

The provision for income taxes consists of the following (in millions):



Years Ended	July 26, 2014			July 27, 2013			July 28, 2012
Federal:
Current	$	1,672		$	601		$	1,836
Deferred	(383		)	152			(270		)
	1,289			753			1,566
State:
Current	176			81			119
Deferred	(64		)	48			(53		)
	112			129			66
Foreign:
Current	692			599			477
Deferred	(231		)	(237		)	9
	461			362			486
Total	$	1,862		$	1,244		$	2,118

Income Before Provision For Income Taxes

Income before provision for income taxes consists of the following (in millions):



Years Ended	July 26, 2014		July 27, 2013		July 28, 2012
United States	$	2,734	$	3,716	$	3,235
International	6,981		7,511		6,924
Total	$	9,715	$	11,227	$	10,159

Difference Between Income Taxes At Federal Statutory Rate And Provision For Income Taxes

The items accounting for the difference between income taxes computed at the federal statutory rate and the provision for income taxes consist of the following:



Years Ended	July 26, 2014		July 27, 2013		July 28, 2012
Federal statutory rate	35.0	%	35.0	%	35.0	%
Effect of:
State taxes, net of federal tax benefit	0.5		0.8		0.4
Foreign income at other than U.S. rates	(16.4	)	(16.4	)	(15.6	)
Tax credits	(0.7	)	(1.6	)	(0.4	)
Domestic manufacturing deduction	(0.9	)	(1.0	)	(1.1	)
Nondeductible compensation	3.3		1.3		1.8
Tax audit settlement	—		(7.1	)	—
Other, net	(1.6	)	0.1		0.7
Total	19.2	%	11.1	%	20.8	%

Aggregate Changes In Gross Unrecognized Tax Benefits

The aggregate changes in the balance of gross unrecognized tax benefits were as follows (in millions):



Years Ended	July 26, 2014			July 27, 2013			July 28, 2012
Beginning balance	$	1,775		$	2,819		$	2,948
Additions based on tax positions related to the current year	262			138			155
Additions for tax positions of prior years	64			187			54
Reductions for tax positions of prior years	(13		)	(1,027		)	(226		)
Settlements	(17		)	(199		)	(41		)
Lapse of statute of limitations	(133		)	(143		)	(71		)
Ending balance	$	1,938		$	1,775		$	2,819

Components Of Deferred Tax Assets And Liabilities

The following table presents the breakdown between current and noncurrent net deferred tax assets (in millions):



	July 26, 2014			July 27, 2013
Deferred tax assets—current	$	2,808		$	2,616
Deferred tax liabilities—current	(134		)	(114		)
Deferred tax assets—noncurrent	1,700			1,539
Deferred tax liabilities—noncurrent	(369		)	(399		)
Total net deferred tax assets	$	4,005		$	3,642

The components of the deferred tax assets and liabilities are as follows (in millions):



	July 26, 2014			July 27, 2013
ASSETS
Allowance for doubtful accounts and returns	$	464		$	390
Sales-type and direct-financing leases	231			167
Inventory write-downs and capitalization	307			216
Investment provisions	212			214
IPR&D, goodwill, and purchased intangible assets	135			123
Deferred revenue	1,689			1,624
Credits and net operating loss carryforwards	796			681
Share-based compensation expense	661			783
Accrued compensation	496			486
Other	676			560
Gross deferred tax assets	5,667			5,244
Valuation allowance	(114		)	(98		)
Total deferred tax assets	5,553			5,146
LIABILITIES
Purchased intangible assets	(1,229		)	(1,101		)
Depreciation	(48		)	(169		)
Unrealized gains on investments	(245		)	(211		)
Other	(26		)	(23		)
Total deferred tax liabilities	(1,548		)	(1,504		)
Total net deferred tax assets	$	4,005		$	3,642