Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Schedule of Significant Components of Provision for Income Taxes Attributable to Continuing Operations

The following table presents significant components of the provision for income taxes attributable to continuing operations:Table 16.1: Significant Components of the Provision for Income Taxes Attributable to Continuing Operations



	Year Ended December 31,
(Dollars in millions)	2018			2017			2016
Current income tax provision:
Federal taxes	$	210		$	1,585		$	2,087
State taxes	234			223			209
International taxes	135			133			104
Total current provision	$	579		$	1,941		$	2,400
Deferred income tax provision (benefit):
Federal taxes	$	620		$	1,509		$	(621	)
State taxes	115			(69		)	(63		)
International taxes	(21		)	(6		)	(2		)
Total deferred provision (benefit)	714			1,434			(686		)
Total income tax provision	$	1,293		$	3,375		$	1,714

Schedule of Effective Income Tax Rate

The following table presents the reconciliation of the U.S. federal statutory income tax rate to the effective income tax rate applicable to income from continuing operations for the years ended December 31, 2018, 2017 and 2016:Table 16.2: Effective Income Tax Rate



	Year Ended December 31,
	2018		2017		2016
Income tax at U.S. federal statutory tax rate	21.0	%	35.0	%	35.0	%
Affordable housing, new markets and other tax credits	(4.0	)	(5.8	)	(4.9	)
IRS method changes	(3.9	)	0.0		0.0
Tax-exempt interest and other nontaxable income	(0.7	)	(1.5	)	(1.4	)
Impacts of the Tax Act	(0.3	)	32.2		N/A
State taxes, net of federal benefit	3.2		2.2		1.9
Non-deductible expenses	2.2		0.7		0.9
Other, net	0.2		(1.3	)	(0.2	)
Effective income tax rate	17.7	%	61.5	%	31.3	%

Schedule of Significant Components of Deferred Tax Assets and Liabilities

The following table presents significant components of our deferred tax assets and liabilities as of December 31, 2018 and 2017. The valuation allowance below represents the adjustment of certain state deferred tax assets and net operating loss carryforwards to the amount we have determined is more likely than not to be realized.Table 16.3: Significant Components of Deferred Tax Assets and Liabilities



(Dollars in millions)	December 31, 2018			December 31, 2017
Deferred tax assets:
Allowance for loan and lease losses	$	1,700		$	1,768
Rewards programs	500			936
Security and loan valuations	288			424
Net operating loss and tax credit carryforwards	271			244
Goodwill and intangibles	187			201
Compensation and employee benefits	167			208
Partnership investments	162			130
Net unrealized losses on derivatives	135			104
Unearned income	114			130
Other assets	152			156
Subtotal	3,676			4,301
Valuation allowance	(245		)	(226		)
Total deferred tax assets	3,431			4,075
Deferred tax liabilities:
Original issue discount	720			703
Fixed assets and leases	204			168
Loan fees and expenses	75			68
Mortgage servicing rights	48			57
Other liabilities	239			215
Total deferred tax liabilities	1,286			1,211
Net deferred tax assets	$	2,145		$	2,864

Schedule of Reconciliation of Change in Unrecognized Tax Benefits

The following table presents the accrued balance of tax, interest and penalties related to unrecognized tax benefits:Table 16.4: Reconciliation of the Change in Unrecognized Tax Benefits



(Dollars in millions)	Gross Unrecognized Tax Benefits			Accrued Interest and Penalties			Gross Tax, Interest and Penalties
Balance as of January 1, 2016	$	130		$	33		$	163
Additions for tax positions related to prior years	0			6			6
Reductions for tax positions related to prior years due to IRS and other settlements	(45		)	(15		)	(60		)
Balance as of December 31, 2016	85			24			109
Additions for tax positions related to prior years	5			7			12
Reductions for tax positions related to prior years due to IRS and other settlements	(4		)	(2		)	(6		)
Balance as of December 31, 2017	86			29			115
Additions for tax positions related to the current year	28			0			28
Additions for tax positions related to prior years	402			25			427
Reductions for tax positions related to prior years due to IRS and other settlements	(76		)	(19		)	(95		)
Balance as of December 31, 2018	$	440		$	35		$	475
Portion of balance at December 31, 2018 that, if recognized, would impact the effective income tax rate	$	181		$	28		$	209