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Table of Contents
Note 6 – Income Taxes
The provision for income taxes for the three years ended September 25, 2010, consisted of the following (in millions):
The foreign provision for income taxes is based on foreign pretax earnings of $13.0 billion, $6.6 billion and $4.6 billion in 2010, 2009 and 2008,
respectively. The Company’
s consolidated financial statements provide for any related tax liability on amounts that may be repatriated, aside
from undistributed earnings of certain of the Company’
s foreign subsidiaries that are intended to be indefinitely reinvested in operations outside
the U.S. As of September 25, 2010, U.S. income taxes have not been provided on a cumulative total of $12.3 billion of such earnings. The
amount of unrecognized deferred tax liability related to these temporary differences is estimated to be approximately $4.0 billion.
As of September 25, 2010 and September 26, 2009, $30.8 billion and $17.4 billion, respectively, of the Company’
s cash, cash equivalents and
marketable securities were held by foreign subsidiaries and are generally based in U.S. dollar-
denominated holdings. Amounts held by foreign
subsidiaries are generally subject to U.S. income taxation on repatriation to the U.S.
Deferred tax assets and liabilities reflect the effects of tax losses, credits, and the future income tax effects of temporary differences between the
consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases and are measured using enacted
tax rates that apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.
68
2010
2009
2008
Federal:
Current
$
2,150
$
1,922
$
1,796
Deferred
1,676
1,077
498
3,826
2,999
2,294
State:
Current
655
524
359
Deferred
(115
)
(2
)
(25
)
540
522
334
Foreign:
Current
282
345
275
Deferred
(121
)
(35
)
(75
)
161
310
200
Provision for income taxes
$
4,527
$
3,831
$
2,828