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Income Taxes (Notes)
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6 Months Ended |
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Jun. 28, 2014
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| Income Tax Disclosure [Abstract] | |
| Income Taxes |
Income Taxes
In the second quarter of 2014, the Company recorded an income tax provision of $4 million, consisting of $5 million of foreign taxes in profitable locations, partially offset by $1 million of tax benefits arising from other comprehensive income and Canadian tax credits. For the six months ended June 28, 2014, the Company recorded an income tax provision of $6 million arising from $8 million of foreign taxes in profitable locations, partially offset by $2 million of tax benefits arising from other comprehensive income and Canadian tax credits.
In the second quarter of 2013, the Company recorded an income tax provision of $3 million, consisting of $3 million of foreign taxes in profitable locations and $1 million related to the reversal of previously recognized tax benefits associated with other comprehensive income, offset by $1 million of tax benefits from Canadian tax credits and the monetization of U.S. tax credits. For the six months ended June 29, 2013, the Company recorded an income tax provision of $5 million arising from $5 million of foreign taxes in profitable locations and $2 million related to the reversal of previously recognized tax benefits associated with other comprehensive income, partially offset by $2 million of tax benefits for Canadian tax credits and monetization of U.S. tax credits.
As of June 28, 2014, substantially all of the Company’s U.S. and Canadian deferred tax assets, net of deferred tax liabilities, continue to be subject to a valuation allowance. The realization of these assets is dependent on substantial future taxable income which, at June 28, 2014, in management’s estimate, is not more likely than not to be achieved.
The Company’s total gross unrecognized tax benefits as of June 28, 2014 were $62 million. The Company currently expects to reduce its unrecognized tax benefits by approximately $31 million, primarily as a result of the potential settlement of tax audits with certain foreign tax authorities over the next 12 months. The Company does not believe it is reasonably possible that other unrecognized tax benefits will materially change in the next 12 months. However, the settlement, resolution or closure of tax audits are highly uncertain.
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