Income Tax (Tables)

12 Months Ended

Dec. 31, 2019

Schedule of Income before Income Tax, Domestic and Foreign [Table Text Block]

Pre-tax income for the years ended December 31, 2019, 2018 and 2017 consists of the following (dollars in millions):



	2019		2018		2017
Pre-tax income - U.S.	$	871	$	626	$	871
Pre-tax income - foreign	261		220		272
Total pre-tax income	$	1,132	$	846	$	1,143

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]

The provision for income tax expense for the years ended December 31, 2019, 2018 and 2017 consists of the following (dollars in millions):



	2019			2018			2017
Current income tax expense (benefit):
U.S.	$	(9	)	$	78		$	131
U.S. Tax Reform	—			(68		)	—
Foreign	60			43			37
Total current	51			53			168
Deferred income tax expense (benefit):
U.S.	182			63			160
U.S. Tax Reform	—			6			(1,034		)
Foreign	29			8			27
Total deferred	211			77			(847		)
Total provision for income taxes	$	262		$	130		$	(679	)

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

The Company’s effective tax rate differed from the U.S. federal income tax statutory rate of 21%, 21%, and 35% as a result of the following for the years ended December 31, 2019, 2018 and 2017 (dollars in millions):



	2019			2018			2017
Tax provision at U.S. statutory rate	$	238		$	178		$	400
Increase (decrease) in income taxes resulting from:
U.S. Tax Reform	—			(62		)	(1,034		)
Foreign tax rate differing from U.S. tax rate	2			4			(22		)
Differences in tax basis in foreign jurisdictions	(23		)	(23		)	(23		)
Deferred tax valuation allowance	56			23			29
Amounts related to audit contingencies	8			1			(7		)
Equity compensation excess benefit	(8		)	(6		)	(10		)
Corporate rate changes	(1		)	1			(6		)
GILTI, net of credits	—			10			—
Subpart F for non-full inclusion companies	1			1			2
Foreign tax credits	(6		)	(3		)	(2		)
Return to provision adjustments	(6		)	(1		)	(5		)
Other, net	1			7			(1		)
Total provision for income taxes	$	262		$	130		$	(679	)
Effective tax rate	23.1		%	15.4		%	(59.4		)%

Schedule Of Income Tax Expense Benefit Intraperiod Tax Allocation [Table Text Block]

Total income taxes for the years ended December 31, 2019, 2018 and 2017 were as follows (dollars in millions):



	2019			2018			2017
Provision for income taxes	$	262		$	130		$	(679	)
Income tax from OCI and additional paid-in-capital:
Net unrealized holding gain (loss) on debt and equity securities recognized for financial reporting purposes	681			(368		)	307
Foreign currency translation	3			19			(42		)
Unrealized pension and post retirement	(5		)	—			—
Total income taxes provided	$	941		$	(219	)	$	(414	)

Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

The tax effects of temporary differences that give rise to significant portions of the deferred income tax assets and liabilities at December 31, 2019 and 2018, are presented in the following tables (dollars in millions):



	2019			2018
Deferred income tax assets:
Nondeductible accruals	$	100		$	86
Differences between tax and financial reporting amounts concerning certain reinsurance transactions	105			102
Differences in the tax basis of cash and invested assets	—			28
Investment income differences	7			80
Deferred acquisition costs capitalized for tax	127			125
Net operating loss carryforward	330			406
Capital loss and tax credit carryforwards	38			33
Subtotal	707			860
Valuation allowance	(236		)	(181		)
Total deferred income tax assets	471			679
Deferred income tax liabilities:
Deferred acquisition costs capitalized for financial reporting	797			843
Differences between tax and financial reporting amounts concerning certain reinsurance transactions	1,293			1,152
Differences in the tax basis of cash and invested assets	991			346
Investment income differences	—			9
Differences in foreign currency translation	52			53
Anticipated future tax credit reduction	26			25
Total deferred income tax liabilities	3,159			2,428
Net deferred income tax liabilities	$	2,688		$	1,749
Balance sheet presentation of net deferred income tax liabilities:
Included in other assets	$	24		$	50
Included in deferred income taxes	2,712			1,799
Net deferred income tax liabilities	$	2,688		$	1,749

Summary of Operating Loss Carryforwards [Table Text Block]

The following table presents consolidated net operating losses (“NOL”) as of December 31, 2019 (dollars in millions):



	2019
NOL with no expiration and with no valuation allowance	$	129
NOL with a full valuation allowance	140
NOL with no expiration and a partial valuation allowance	513
NOL with expiration dates between 2029 & 2038 with no valuation allowance	530
Total net operating loss carryforwards	$	1,312

Summary of Income Tax Contingencies [Table Text Block]

A reconciliation of the beginning and ending amount of unrecognized tax benefits for the years ended December 31, 2019, 2018 and 2017, is as follows (dollars in millions):



	Total Unrecognized Tax Benefits
	2019			2018			2017
Beginning balance, January 1	$	325		$	321		$	297
Acquisition Accounting	—			1			—
Additions for tax positions of prior years	264			256			248
Reductions for tax positions of prior years	(262		)	(257		)	(247		)
Additions for tax positions of current year	6			4			36
Settlements with tax authorities	—			—			(13		)
Ending balance, December 31	$	333		$	325		$	321