BB&T 2013 Annual Report Download - page 122

122
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 and net deferred tax liabilities are included in
accounts payable and other liabilities on the Consolidated Balance Sheets.
December 31,
2013 2012
(Dollars in millions)
Deferred tax assets:
ALLL $ 655 $ 771
Postretirement plans 180 432
N
et unrealized loss on AFS securities 172 ―
Equity-based compensation 152 144
Reserves and expense accruals 181 150
N
et unrealized loss on cash flow hedges ― 105
Other 189 213
Total deferred tax assets 1,529 1,815
Deferred tax liabilities:
Prepaid pension plan expense 431 373
MSRs 380 201
Lease financing 315 270
Loan fees and expenses 263 244
Identifiable intangible assets 128 161
Depreciation 59 57
Derivatives and hedging 45 163
N
et unrealized gain on AFS securities ― 201
Other 61 70
Total deferred tax liabilities 1,682 1,740
N
et deferred tax asset (liability) $ (153) $ 75
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, 2013, 2012 and 2011.
Years Ended December 31,
2013 2012 2011
(Dollars in millions)
Beginning balance of unrecognized tax benefits $ 297 $ 301 $ 292
Additions based on tax positions related to current year 18 14 ―
Additions for tax positions of prior years 343 ― 6
Settlements ― (5) (1)
Unrecognized deferred tax benefits from business acquisitions (14) (13) 4
Ending balance of unrecognized tax benefits $ 644 $ 297 $ 301
The amount of unrecognized Federal and state tax benefits that would have impacted the effective tax rate if recognized was
$642 million, $297 million, and $299 million as of December 31, 2013, 2012 and 2011, respectively. The portion of the gross
state unrecognized tax benefits that would be offset by the tax benefit of the federal deduction would not impact the effective
tax rate. In addition, the Company had $213 million, $37 million and $39 million in liabilities for tax-related interest and
penalties recorded on its Consolidated Balance Sheets at December 31, 2013, 2012, and 2011, respectively. Total net interest
and penalties related to unrecognized tax benefits recognized in the 2013 Consolidated Statement of Income was $176
million. Total net interest and penalties related to unrecognized tax benefits recognized in the 2012 and 2011 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.