Income taxes (Tables)

12 Months Ended

Dec. 31, 2014

Income before Income Taxes



	U.S.		Non-U.S.		Total
2014	$	2,684	$	1,190	$	3,874
2013	1,507		1,247		2,754
2012	319		1,616		1,935

Provision (benefit) for income taxes

Provision (Benefit) for Income Taxes



	U.S. Federal			Non-U.S.		U.S. State			Total
2014
Current	$	911		$	194	$	9		$	1,114
Deferred	(73		)	11		1			(61		)
Total	$	838		$	205	$	10		$	1,053

2013
Current	$	291		$	247	$	4		$	542
Deferred	17			33		—			50
Total	$	308		$	280	$	4		$	592

2012
Current	$	(108	)	$	156	$	(2	)	$	46
Deferred	65			65		—			130
Total	$	(43	)	$	221	$	(2	)	$	176

Principal reconciling items from income tax computed at statutory federal rate

Principal reconciling items from income tax computed at the statutory federal rate follow:



	For Years Ended December 31,
	2014			2013			2012
Computed tax at statutory rate	$	1,356		$	964		$	677
Non-U.S. effective tax rates	(212		)	(156		)	(345		)
U.S. R&D tax credit	(59		)	(129		)	—
U.S. tax benefit for manufacturing	(51		)	(66		)	(158		)
Impact of changes to uncertain tax positions	3			(14		)	(88		)
Non-deductible expenses	6			13			42
Other	10			(20		)	48
Total provision for income taxes	$	1,053		$	592		$	176

Primary components of deferred income tax assets and liabilities

The primary components of deferred income tax assets and liabilities were as follows:



	December 31,
	2014			2013
Deferred income tax assets:
Deferred loss and tax credit carryforwards	$	289		$	345
Accrued expenses	248			265
Stock-based compensation	238			262
Inventories and related reserves	157			162
Retirement costs for defined benefit and retiree health care	96			101
Other	122			148
	1,150			1,283
Valuation allowance	(195		)	(219		)
	955			1,064
Deferred income tax liabilities:
Acquisition-related intangibles and fair-value adjustments	(688		)	(804		)
International earnings	(104		)	(121		)
Property, plant and equipment	(10		)	(57		)
Other	(37		)	(31		)
	(839		)	(1,013		)
Net deferred income tax asset	$	116		$	51

Deferred income tax assets and liabilities presentation on the Balance sheet

The deferred income tax assets and liabilities based on tax jurisdictions are presented on the Consolidated Balance Sheets as follows:



	December 31,
	2014			2013
Current deferred income tax assets	$	347		$	393
Noncurrent deferred income tax assets	172			207
Current deferred income tax liabilities	(4		)	(1		)
Noncurrent deferred income tax liabilities	(399		)	(548		)
Net deferred income tax asset	$	116		$	51

Summary of income tax contingencies

The changes in the total amounts of uncertain tax positions are summarized as follows:



	2014			2013			2012
Balance, January 1	$	91		$	184		$	210
Additions based on tax positions related to the current year	10			7			12
Additions for tax positions of prior years	52			19			45
Reductions for tax positions of prior years	(9		)	(10		)	(92		)
Settlements with tax authorities	(36		)	(96		)	39
Expiration of the statute of limitations for assessing taxes	—			(13		)	(30		)
Balance, December 31	$	108		$	91		$	184

Interest income (expense) recognized in the year ended December 31	$	6		$	(10	)	$	32

Interest receivable (payable) as of December 31	$	—		$	(5	)	$	8

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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