Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Income tax expense was as follows (in millions):

Reconciliation of the U.S. federal statutory income tax rate to the effective tax rate was as follows:



	Year Ended		Year Ended		Year Ended
	December 31, 2017		December 31, 2016		December 31, 2015
U.S. Federal statutory income tax rate	35.0	%	35.0	%	35.0	%
State income taxes, net of federal tax benefit	2.9		2.5		2.2
Tax law change	(116.0	)	—		—
Other, net	(0.5	)	(0.2	)	0.1
Effective tax rate	(78.6	)%	37.3	%	37.3	%

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



	December 31, 2017			December 31, 2016
Deferred tax liabilities:
Property and equipment	$	(13,583	)	$	(20,634	)
Other	(391		)	(340		)
Total deferred tax liabilities	(13,974		)	(20,974		)
Deferred tax assets:
Casualty and environmental	159			278
Compensation and benefits	112			334
Long-term debt fair value adjustment under acquisition method accounting	32			76
Intangible assets and liabilities	32			72
Pension and retiree health and welfare benefits	16			89
Other	171			259
Total deferred tax assets	522			1,108
Net deferred tax liability	$	(13,452	)	$	(19,866	)

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in millions):



	Year Ended			Year Ended			Year Ended
	December 31, 2017			December 31, 2016			December 31, 2015
Beginning balance	$	62		$	69		$	78
Additions for tax positions related to current year	7			4			7
Additions (reductions) for tax positions taken in prior years	(1		)	(1		)	(8		)
Additions (reductions) for tax positions as a result of:
Settlements	—			1			1
Lapse of statute of limitations	(11		)	(11		)	(9		)
Ending balance	$	57		$	62		$	69