Income Taxes (Tables)

12 Months Ended

Sep. 30, 2022

U.S. and Non-U.S. Income Before Income Tax

The Company’s income before taxes by fiscal year consisted of the following:


	For the Years Ended September 30,
	2022		2021		2020
	(in millions)
U.S.	$	11,051	$	11,002	$	9,178
Non-U.S.	7,085		5,061		4,612
Total income before taxes	$	18,136	$	16,063	$	13,790

Comprehensive Income Tax (Expense) Benefit Components Table

Income tax provision by fiscal year consisted of the following:


	For the Years Ended September 30,
	2022		2021		2020
	(in millions)
Current:
U.S. federal	$	2,166	$	1,943	$	1,662
State and local	104		69		212
Non-U.S.	1,245		869		743
Total current taxes	3,515		2,881		2,617
Deferred:
U.S. federal	(231)		(57)		42
State and local	(77)		(28)		9
Non-U.S.	(28)		956		256
Total deferred taxes	(336)		871		307
Total income tax provision	$	3,179	$	3,752	$	2,924

Components of Deferred Tax Assets and Liabilities

The tax effect of temporary differences that give rise to significant portions of deferred tax assets and liabilities, are presented below:


	September 30,
	2022		2021
	(in millions)
Deferred Tax Assets:
Accrued compensation and benefits	$	172	$	166
Accrued litigation obligation	331		234
Client incentives	442		327
Net operating loss carryforwards	117		104
Comprehensive loss	21		106
Federal benefit of state taxes	133		157
Other	71		55
Valuation allowance	(120)		(103)
Deferred tax assets	1,167		1,046
Deferred Tax Liabilities:
Property, equipment and technology, net	(450)		(346)
Intangible assets	(5,788)		(6,452)
Unrealized gains on equity securities	(124)		(203)
Foreign taxes	(50)		(93)
Deferred tax liabilities	(6,412)		(7,094)
Net deferred tax liabilities	$	(5,245)	$	(6,048)

Reconciliation of the US Statutory Federal Tax Rate

The income tax provision differs from the amount of income tax determined by applying the applicable U.S. federal statutory rate to pretax income, as a result of the following:


	For the Years Ended September 30,
	2022				2021				2020
	(in millions, except percentages)
U.S. federal income tax at statutory rate	$	3,809	21	%	$	3,373	21	%	$	2,896	21	%
State income taxes, net of federal benefit	216		1	%	222		1	%	199		2	%
Non-U.S. tax effect, net of federal benefit	(588)		(3	%)	(505)		(3	%)	(483)		(4	%)
Remeasurement of deferred tax balances	—		—	%	1,007		6	%	329		2	%
Conclusion of audits	—		—	%	(255)		(2	%)	—		—	%
State tax apportionment position	(176)		(1	%)	—		—	%	—		—	%
Other, net	(82)		—	%	(90)		—	%	(17)		—	%
Income tax provision	$	3,179	18	%	$	3,752	23	%	$	2,924	21	%

Unrecognized Tax Benefits Reconciliation, Table

A reconciliation of beginning and ending unrecognized tax benefits by fiscal year is as follows:


	2022		2021		2020
	(in millions)
Balance at beginning of period	$	2,488	$	2,579	$	2,234
Increases of unrecognized tax benefits related to prior years	10		34		66
Decreases of unrecognized tax benefits related to prior years	(143)		(386)		(83)
Increases of unrecognized tax benefits related to current year	350		326		376
Decreases related to settlements with taxing authorities	(19)		(63)		(12)
Reductions related to lapsing statute of limitations	(3)		(2)		(2)
Balance at end of period	$	2,683	$	2,488	$	2,579