Quarterly report pursuant to Section 13 or 15(d)

Income Taxes

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Income Taxes
9 Months Ended
Oct. 28, 2017
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes
The net tax benefit of $29 million for the three months ended October 28, 2017 consisted of state and foreign tax expenses of $3 million, $1 million of expense related to the deferred tax asset change arising from the tax amortization of indefinite-lived intangible assets and $1 million of expense resulting from state audit settlements, offset by a $30 million benefit relating to other comprehensive income and a net tax benefit of $4 million to adjust the valuation allowance.
The net tax benefit of $40 million for the nine months ended October 28, 2017 consisted of state and foreign tax expenses of $10 million and $5 million of expense related to the deferred tax asset change arising from the tax amortization of indefinite-lived intangible assets, offset by a $46 million benefit relating to other comprehensive income and a net tax benefit of $8 million to adjust the valuation allowance and $1 million resulting from state audit settlements.
As of October 28, 2017, we have approximately $2.5 billion of net operating losses (NOLs) available for U.S. federal income tax purposes, which expire in 2032 through 2034 and $63 million of tax credit carryforwards that expire at various dates through 2035. A valuation allowance of $847 million fully offsets the federal deferred tax assets resulting from the NOL and tax credit carryforwards that expire at various dates through 2034. A valuation allowance of $250 million fully offsets the deferred tax assets resulting from the state NOL carryforwards that expire at various dates through 2034. In assessing the need for the valuation allowance, we considered both positive and negative evidence related to the likelihood of realization of the deferred tax assets. As a result of our periodic assessment, our estimate of the realization of deferred tax assets is solely based on the future reversals of existing taxable temporary differences and tax planning strategies that we would make use of to accelerate taxable income to utilize expiring NOL and tax credit carryforwards. Accordingly, in the third quarter and first nine months of 2017, the valuation allowance was increased by $24 million and $104 million, respectively, to offset the net deferred tax assets created in those periods relating primarily to the increase in NOL carryforwards.