Regions Bank 2009 Annual Report Download - page 177

Income taxes from continuing operations for financial reporting purposes differs from the amount computed
by applying the statutory federal income tax rate of 35% for the years ended December 31, for the reasons below:
2009 2008 2007
(In millions)
Tax on income computed at statutory federal income tax rate ..................... $(421) $(2,076) $ 714
Increase (decrease) in taxes resulting from:
Goodwill impairment ................................................ — 2,100 —
Lease financing ..................................................... 458 8 24
Tax-exempt income from obligations of states and political subdivisions ....... (22) (27) (29)
State income tax, net of federal tax benefit ............................... (65) (38) 7
Interest accrued related to uncertain tax positions .......................... — 12 39
Net release of uncertain tax position reserves ............................. (2) (284) (10)
Tax credits ........................................................ (80) (56) (81)
Bank owned life insurance ............................................ (30) (31) (25)
Other, net ......................................................... (9) 44 7
$(171) $ (348) $ 646
Effective tax rate ........................................................ 14.2% 5.9% 31.7%
From time to time Regions engages in business plans that may also have an effect on its tax liabilities.
While Regions has obtained the opinion of advisors that the tax aspects of these strategies should prevail,
examination of Regions’ income tax returns or changes in tax law may impact the tax benefits of these plans.
The provisions for income taxes from continuing operations charged to earnings are summarized for the
years ended December 31 as follows:
Current tax
(benefit) expense
Deferred tax
(benefit) expense Total
(In millions)
2009
Federal ................................................... $(420) $ 351 $ (69)
State ..................................................... 4 (106) (102)
$(416) $ 245 $(171)
2008
Federal ................................................... $ 32 $(318) $(286)
State ..................................................... 27 (89) (62)
$ 59 $(407) $(348)
2007
Federal ................................................... $751 $(120) $ 631
State ..................................................... 19 (4) 15
$ 770 $(124) $ 646
UNCERTAIN TAX POSITIONS
Regions and its subsidiaries file income tax returns in the United States, as well as various state
jurisdictions. As the successor of acquired taxpayers, Regions is responsible for the resolution of audits from
both federal and state taxing authorities. In December 2008, the Company reached an agreement with the Internal
Revenue Service (“IRS”) Appeals Division on the Federal tax treatment of a broad range of uncertain tax
positions. The agreement covered the Federal tax returns of Regions Financial Corporation, Union Planters
Corporation and AmSouth Bancorporation for tax years 1999-2006. With few exceptions in certain jurisdictions,
163