Income Taxes (Tables)

12 Months Ended

Dec. 31, 2015

Reconciliation of the change in the amount of unrecognized tax benefits

The reconciliation of the change in the amount of unrecognized tax benefits for the years ended December 31 is as follows:



($ in millions)	2015		2014		2013
Balance – beginning of year	$	—	$	—	$	25
Increase for tax positions taken in a prior year	4		—		1
Decrease for tax positions taken in a prior year	—		—		—
Increase for tax positions taken in the current year	3		—		—
Decrease for tax positions taken in the current year	—		—		—
Decrease for settlements	—		—		(26		)
Reductions due to lapse of statute of limitations	—		—		—
Balance – end of year	$	7	$	—	$	—

Components of the deferred income tax assets and liabilities

The components of the deferred income tax assets and liabilities as of December 31 are as follows:



($ in millions)	2015			2014
Deferred assets
Unearned premium reserves	$	796		$	763
Pension	236			254
Discount on loss reserves	203			210
Difference in tax bases of invested assets	202			64
Accrued compensation	189			206
Other postretirement benefits	76			138
Other assets	137			138
Total deferred assets	1,839			1,773
Deferred liabilities
DAC	(1,157		)	(1,076		)
Unrealized net capital gains	(303		)	(994		)
Life and annuity reserves	(260		)	(192		)
Other liabilities	(209		)	(226		)
Total deferred liabilities	(1,929		)	(2,488		)
Net deferred liability	$	(90	)	$	(715	)

Components of income tax expense

The components of income tax expense for the years ended December 31 are as follows:



($ in millions)	2015		2014		2013
Current	$	1,033	$	1,123	$	869
Deferred	78		263		247
Total income tax expense	$	1,111	$	1,386	$	1,116

Reconciliation of the statutory federal income tax rate to the effective income tax rate on income from operations

A reconciliation of the statutory federal income tax rate to the effective income tax rate on income from operations for the years ended December 31 is as follows:



	2015		2014		2013
Statutory federal income tax rate	35.0	%	35.0	%	35.0	%
Tax-exempt income	(1.0	)	(0.9	)	(1.8	)
Tax credits	(0.9	)	(0.7	)	(2.2	)
Sale of subsidiary	—		(0.9	)	2.0
Other ⁽¹⁾	0.8		0.2		(0.1	)
Effective income tax rate	33.9	%	32.7	%	32.9	%

______________________________


⁽¹⁾	Includes $45 million of income tax expense related to the change in accounting guidance for investments in qualified affordable housing projects adopted in 2015.