Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

v3.6.0.2
Income Taxes (Tables)
12 Months Ended
Jan. 28, 2017
Income Tax Disclosure [Abstract]  
Schedule of Components of Income Tax Expense (Benefit)
The components of our income tax expense/(benefit) were as follows:
($ in millions)
 
2016
 
2015
 
2014
Current
 
 
 
 
 
 
Federal and foreign
 
$
(12
)
 
$
5

 
$
12

State and local
 
4

 
6

 
8

Total current
 
(8
)
 
11

 
20

Deferred
 
 
 
 
 
 
Federal and foreign
 
9

 
(1
)
 
9

State and local
 

 
(1
)
 
(6
)
Total deferred
 
9

 
(2
)
 
3

Total
 
$
1

 
$
9

 
$
23

Schedule of Effective Income Tax Rate Reconciliation
:
($ in millions)
 
2016
 
2015
 
2014
Federal income tax at statutory rate
 
1

 
(176
)
 
(243
)
State and local income tax, less federal income tax benefit
 
(2
)
 
(21
)
 
(29
)
Increase/(decrease) in valuation allowance
 
(1
)
 
185

 
290

Other, including permanent differences and credits
 
3

 
21

 
5

Total income tax expense/(benefit)
 
1

 
9

 
23

Schedule of Deferred Tax Assets and Liabilities
Our deferred tax assets and liabilities were as follows:
($ in millions)
 
2016
 
2015
Assets
 
 
 
 
Merchandise inventory
 
$
27

 
$
39

Accrued vacation pay
 
17

 
22

Gift cards
 
98

 
90

Stock-based compensation
 
58

 
77

Deferred equity adjustment
 
4

 
11

State taxes
 
12

 
15

Workers’ compensation/general liability
 
74

 
85

Accrued rent
 
39

 
37

Litigation exposure
 
16

 
32

Mirror savings plan
 
13

 
15

Pension and other retiree obligations
 
76

 
96

Net operating loss and tax credit carryforwards
 
931

 
1,072

Other
 
73

 
65

Total deferred tax assets
 
1,438

 
1,656

Valuation allowance
 
(993
)
 
(1,025
)
Total net deferred tax assets
 
445

 
631

Liabilities
 
 
 
 
Depreciation and amortization
 
(561
)
 
(741
)
Tax benefit transfers
 
(53
)
 
(56
)
Long-lived intangible assets
 
(35
)
 
(28
)
Total deferred tax liabilities
 
(649
)
 
(825
)
Total net deferred tax liabilities
 
$
(204
)
 
$
(194
)


Deferred tax assets and liabilities included in our Consolidated Balance Sheets were as follows:
($ in millions)
 
2016
 
2015
Other current assets
 
$
196

 
$
231

Other long-term liabilities
 
(400
)
 
(425
)
Total net deferred tax liabilities
 
$
(204
)
 
$
(194
)
Summary of Income Tax Contingencies
A reconciliation of unrecognized tax benefits is as follows:
($ in millions)
 
2016
 
2015
 
2014
Beginning balance
 
$
91

 
$
62

 
$
70

Additions for tax positions of prior years
 
16

 
40

 
10

Reductions for tax positions of prior years
 
(24
)
 

 

Settlements and effective settlements with tax authorities
 
(4
)
 
(10
)
 
(16
)
Expirations of statute
 

 
(1
)
 
(2
)
Balance at end of year 
 
$
79

 
$
91

 
$
62



Unrecognized tax benefits included in our Consolidated Balance Sheets were as follows:
($ in millions)
 
2016
 
2015
Deferred taxes (current assets)
 
$
75

 
$
84

Accounts payable and accrued expenses (Note 6)
 
3

 
3

Other liabilities (Note 7)
 
1

 
4

Total
 
$
79

 
$
91