BB&T 2011 Annual Report Download - page 127

The tax effects of temporary differences that gave rise to significant portions of the net deferred tax assets and liabilities
are reflected in the table below. Net deferred tax assets are included in other assets on the “Consolidated Balance Sheets”.
December 31,
2011 2010
(Dollars in millions)
Deferred tax assets:
Allowance for loan and lease losses $ 855 $ 1,003
Net unrealized loss on securities available for sale — 198
Postretirement plans 362 219
Equity-based compensation 130 123
Loan/Securities basis difference 127 165
Foreclosed property write-downs 240 196
Net unrealized loss on cash flow hedges 95 28
Other 257 262
Total deferred tax assets 2,066 2,194
Deferred tax liabilities:
Lease financing 267 211
Prepaid pension plan expense 352 360
Loan fees and expenses 225 199
Depreciation 76 78
Identifiable intangible assets 92 107
Loan servicing rights 156 218
Derivatives and hedging 136 68
Other 120 97
Total deferred tax liabilities 1,424 1,338
Net deferred tax assets $ 642 $ 856
On a periodic basis, BB&T evaluates its income tax positions based on tax laws and regulations and financial reporting
considerations, and records adjustments as appropriate. This evaluation takes into consideration the status of current
taxing authorities’ examinations of BB&T’s tax returns, recent positions taken by the taxing authorities on similar
transactions, if any, and the overall tax environment in relation to tax-advantaged transactions. The following table
presents changes in unrecognized tax benefits for the years ended December 31, 2011, 2010 and 2009.
Years Ended December 31,
2011 2010 2009
(Dollars in millions)
Beginning balance of unrecognized tax benefits $ 292 $ 179 $ 197
Additions for tax positions of prior years 6 — 1
Settlements (1) — (16)
Lapse of statute of limitations — (1) (3)
Unrecognized deferred tax benefits from business acquisitions 4 114 —
Ending balance of unrecognized tax benefits $ 301 $ 292 $ 179
As of December 31, 2011, BB&T had $301 million of unrecognized Federal and state tax benefits that would have
impacted the effective tax rate if recognized. In addition, the Company had $39 million and $37 million in liabilities for
tax-related interest recorded on its Consolidated Balance Sheets at December 31, 2011 and 2010, respectively. Total
interest, net of the Federal benefit, related to unrecognized tax benefits recognized in the 2011, 2010 and 2009
Consolidated Statements of Income was immaterial. BB&T classifies interest and penalties related to income taxes as a
component of the provision for income taxes in the Consolidated Statements of Income.
The IRS has completed its Federal income tax examinations of BB&T through 2007. In connection with the settlement
agreement with the IRS regarding its leveraged lease transactions, BB&T is entitled to Federal income tax refunds for tax
years 1998-2006. During 2010, BB&T received Federal tax refunds including interest of approximately $379 million for
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