QUALCOMM Incorporated Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

Income Taxes (Tables)

12 Months Ended

Sep. 27, 2015

Schedule of Components of Income Tax Expense (Benefit)

The components of the income tax provision for continuing operations were as follows (in millions):



	2015			2014			2013
Current (benefit) provision:
Federal	$	(67	)	$	172		$	324
State	4			10			15
Foreign	1,307			1,116			1,068
	1,244			1,298			1,407
Deferred (benefit) provision:
Federal	(9		)	(30		)	(32		)
State	1			(10		)	6
Foreign	(17		)	(14		)	(32		)
	(25		)	(54		)	(58		)
	$	1,219		$	1,244		$	1,349

Schedule of Income before Income Tax, Domestic and Foreign

The components of income from continuing operations before income taxes by United States and foreign jurisdictions were as follows (in millions):



	2015		2014		2013
United States	$	2,993	$	3,213	$	3,798
Foreign	3,494		5,565		4,396
	$	6,487	$	8,778	$	8,194

Schedule of Effective Income Tax Rate Reconciliation

The following is a reconciliation of the expected statutory federal income tax provision to the Company’s actual income tax provision for continuing operations (in millions):



	2015			2014			2013
Expected income tax provision at federal statutory tax rate	$	2,270		$	3,072		$	2,868
State income tax provision, net of federal benefit	18			24			26
Foreign income taxed at other than U.S. rates	(937		)	(1,750		)	(1,362		)
Research and development tax credits	(148		)	(61		)	(195		)
Other	16			(41		)	12
	$	1,219		$	1,244		$	1,349

Summary of Income Tax Holiday

Had the Company established QCT’s non-United States headquarters in Singapore without these tax incentives, the Company’s income tax expense would have been higher and impacted earnings per share attributable to Qualcomm as follows (in millions, except per share amounts):



	2015		2014		2013
Additional income tax expense	$	656	$	690	$	758
Reduction to diluted earnings per share	$	0.40	$	0.40	$	0.43

Schedule of Deferred Tax Assets and Liabilities

The Company had deferred tax assets and deferred tax liabilities as follows (in millions):



	September 27, 2015			September 28, 2014
Unearned revenues	$	1,029		$	1,189
Unused tax credits	897			388
Unrealized losses on marketable securities	441			370
Share-based compensation	331			404
Accrued liabilities and reserves	317			529
Unused net operating losses	265			120
Other	95			93
Total gross deferred tax assets	3,375			3,093
Valuation allowance	(635		)	(414		)
Total net deferred tax assets	2,740			2,679
Intangible assets	(548		)	(315		)
Unrealized gains on marketable securities	(273		)	(484		)
Other	(105		)	(135		)
Total deferred tax liabilities	(926		)	(934		)
Net deferred tax assets	$	1,814		$	1,745
Reported as:
Current deferred tax assets	$	635		$	577
Non-current deferred tax assets	1,453			1,174
Current deferred tax liabilities (1)	(4		)	—
Non-current deferred tax liabilities (1)	(270		)	(6		)
	$	1,814		$	1,745


(1)	Current deferred tax liabilities and non-current deferred tax liabilities were included in other current liabilities and other liabilities, respectively, in the consolidated balance sheets.

Schedule of Unrecognized Tax Benefits Roll Forward

A summary of the changes in the amount of unrecognized tax benefits for fiscal 2015, 2014 and 2013 follows (in millions):



	2015			2014			2013
Beginning balance of unrecognized tax benefits	$	87		$	221		$	86
Additions based on prior year tax positions	31			1			1
Reductions for prior year tax positions and lapse in statute of limitations	(70		)	(67		)	—
Additions for current year tax positions	5			5			145
Settlements with taxing authorities	(13		)	(73		)	(11		)
Ending balance of unrecognized tax benefits	$	40		$	87		$	221