Income Taxes (Tables)

12 Months Ended

Jul. 31, 2016

Provision for income taxes from continuing operations

The provision for income taxes from continuing operations consisted of the following for the periods indicated:



	Twelve Months Ended July 31,
(In millions)	2016			2015		2014
Current:
Federal	$	401		$	253	$	358
State	33			20		21
Foreign	13			7		10
Total current	447			280		389
Deferred:
Federal	(42		)	14		51
State	(7		)	1		5
Foreign	(1		)	4		2
Total deferred	(50		)	19		58
Total provision for income taxes from continuing operations	$	397		$	299	$	447

Sources of income from continuing operations before the provision for income taxes

The sources of income from continuing operations before the provision for income taxes consisted of the following for the periods indicated:



	Twelve Months Ended July 31,
(In millions)	2016			2015			2014
United States	$	1,205		$	716		$	1,276
Foreign	(2		)	(4		)	24
Total	$	1,203		$	712		$	1,300

Differences between income taxes calculated using the federal statutory income tax rate and the provision for income taxes from continuing operations

Differences between income taxes calculated using the federal statutory income tax rate of 35% and the provision for income taxes from continuing operations were as follows for the periods indicated:



	Twelve Months Ended July 31,
(In millions)	2016			2015			2014
Income from continuing operations before income taxes	$	1,203		$	712		$	1,300

Statutory federal income tax	$	421		$	249		$	455
State income tax, net of federal benefit	17			15			17
Federal research and experimentation credits	(33		)	(19		)	(7		)
Domestic production activities deduction	(34		)	(19		)	(25		)
Share-based compensation	16			15			8
Effects of non-U.S. operations	11			12			1
Non-deductible goodwill	—			40			—
Other, net	(1		)	6			(2		)
Total provision for income taxes from continuing operations	$	397		$	299		$	447

Components of deferred tax assets and liabilities

Significant deferred tax assets and liabilities were as follows at the dates indicated:



	July 31,
(In millions)	2016			2015
Deferred tax assets:
Accruals and reserves not currently deductible	$	33		$	24
Deferred revenue	56			12
Deferred rent	14			10
Accrued and deferred compensation	55			52
Loss and tax credit carryforwards	51			44
Share-based compensation	62			52
Net basis difference in investments held for sale	—			122
Other, net	11			7
Total deferred tax assets	282			323
Deferred tax liabilities:
Intangible assets	86			87
Property and equipment	24			20
Total deferred tax liabilities	110			107
Total net deferred tax assets	172			216
Valuation allowance	(40		)	(30		)
Total net deferred tax assets, net of valuation allowance	$	132		$	186

Components of net deferred tax assets and liabilities

The components of total net deferred tax assets, net of valuation allowances, as shown on our balance sheets were as follows at the dates indicated:



	July 31,
(In millions)	2016			2015
Current deferred income taxes	$	—		$	231
Long-term deferred income taxes	139			5
Long-term deferred income taxes included in other long-term obligations	(7		)	(50		)
Total net deferred tax assets, net of valuation allowance	$	132		$	186

Aggregate changes in the balance of gross unrecognized tax benefits

The aggregate changes in the balance of our gross unrecognized tax benefits were as follows for the periods indicated:



	Twelve Months Ended July 31,
(In millions)	2016			2015			2014
Gross unrecognized tax benefits, beginning balance	$	56		$	40		$	39
Increases related to tax positions from prior fiscal years, including acquisitions	7			15			4
Decreases related to tax positions from prior fiscal years	(7		)	(1		)	(8		)
Increases related to tax positions taken during current fiscal year	15			5			5
Settlements with tax authorities	(11		)	(3		)	—
Gross unrecognized tax benefits, ending balance	$	60		$	56		$	40