|9 Months Ended|
Sep. 24, 2022
|Income Tax Disclosure [Abstract]|
|Income Taxes||Income Taxes
The Company recorded an income tax benefit of $135 million and a provision of $32 million for the three and nine months ended September 24, 2022, respectively, representing effective tax rates of 195.7% and 2.4%, respectively. The Company recorded an income tax provision of $82 million and $284 million for the three and nine months ended September 25, 2021, respectively, representing effective tax rates of 8.2% and 11.5%, respectively.
The determination of the Company’s income taxes for the three and nine months ended September 24, 2022 was based on applying the Company’s estimated annual effective tax rate to the year-to-date pre-tax book income adjusted for discrete tax items, such as excess tax benefits from stock-based compensation. The tax benefit for the three months ended September 24, 2022 was primarily due to lower year-to-date pre-tax book income. The difference between the U.S. federal statutory tax rate of 21% and the Company's effective tax rate was primarily due to year-to-date income tax benefit from income eligible for the foreign-derived intangible income (FDII) benefit and research tax credits.
The difference between the U.S. federal statutory tax rate of 21% and the Company's effective tax rate for the three and nine months ended September 25, 2021 was primarily due to a tax FDII benefit and research tax credits.
As of September 24, 2022, the Company continues to maintain valuation allowances for certain federal, state, and foreign tax attributes. The federal valuation allowance maintained is due to limitations under Internal Revenue Code Section 382 or 383, separate return loss year rules, or dual consolidated loss rules. Certain state and foreign valuation allowances maintained are due to a lack of sufficient sources of taxable income.
As of the nine months ended September 24, 2022, the liability for uncertain tax positions increased by $798 million primarily due to the utilization of certain tax attributes that may be subject to additional limitation.As a result of the acquisition of Xilinx, the Company recorded $4.3 billion of net deferred tax liabilities primarily on the excess of book basis over the tax basis of the acquired intangible assets, including $863 million of GILTI net deferred tax liability. The Company also recorded $147 million of current tax payable as of the Xilinx Acquisition Date. Additionally, the Company assumed $204 million of liability for uncertain tax positions and $321 million of long-term liability for transition-tax, which is payable over the next three years.
The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef