Verizon Wireless 2014 Annual Report Download - page 68

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66
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued
NOTE 13
TAXES
The components of income before (provision) benet for income taxes
are as follows:
(dollars in millions)
Years Ended December 31, 2014 2013 2012
Domestic $ 12,992 $ 28,833 $ 9,316
Foreign 2,278 444 581
Total $ 15,270 $ 29,277 $ 9,897
The components of the provision (benet) for income taxes are as follows:
(dollars in millions)
Years Ended December 31, 2014 2013 2012
Current
Federal $ 2,657 $ (197) $ 223
Foreign 81 (59) (45)
State and Local 668 201 114
Total 3,406 (55) 292
Deferred
Federal (51) 5,060 (559)
Foreign (9) 8 10
State and Local (32) 717 (403)
Total (92) 5,785 (952)
Total income tax provision (benet) $ 3,314 $ 5,730 $ (660)
The following table shows the principal reasons for the difference
between the eective income tax rate and the statutory federal income
tax rate:
Years Ended December 31, 2014 2013 2012
Statutory federal income tax rate 35.0 % 35.0 % 35.0 %
State and local income tax rate, net of
federal tax benets 2.7 2.1 (1.9)
Aordable housing credit (1.0) (0.6) (1.9)
Employee benets including ESOP
dividend (0.7) (0.4) (1.1)
Disposition of Omnitel Interest (5.9) - -
Noncontrolling interests (5.0) (14.3) (33.7)
Other, net (3.4) (2.2) (3.1)
Eective income tax rate 21.7 % 19.6 % (6.7)%
The eective income tax rate for 2014 was 21.7% compared to 19.6% for
2013. The increase in the eective income tax rate was primarily due to
additional income taxes on the incremental income from the Wireless
Transaction completed on February 21, 2014 and was partially oset
by the utilization of certain tax credits in connection with the Omnitel
Transaction in 2014 and the eective income tax rate impact of lower
income before income taxes due to severance, pension and benefit
charges recorded in 2014 compared to severance, pension and ben-
et credits recorded in 2013. The decrease in the provision for income
taxes was primarily due to lower income before income taxes due to
severance, pension and benet charges recorded in 2014 compared to
severance, pension and benet credits recorded in 2013.
The eective income tax rate for 2013 was 19.6% compared to (6.7)%
for 2012. The increase in the eective income tax rate and provision for
income taxes was primarily due to higher income before income taxes
as a result of severance, pension and benet credits recorded during
2013 compared to lower income before income taxes as a result of sever-
ance, pension and benet charges as well as early debt redemption costs
recorded during 2012.
The amounts of cash taxes paid are as follows:
(dollars in millions)
Years Ended December 31, 2014 2013 2012
Income taxes, net of amounts refunded $ 4,093 $ 422 $ 351
Employment taxes 1,290 1,282 1,308
Property and other taxes 1,797 2,082 1,727
Total $ 7,180 $ 3,786 $ 3,386