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SEC Filings

8-K
ALTRIA GROUP, INC. filed this Form 8-K on 02/01/2018
Entire Document
 

Altria Group, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
_________________________


The following table sets forth pre-tax amounts by component, reclassified from accumulated other comprehensive losses to net earnings:
 
 
For the Years Ended December 31,
(in millions)
 
2017

 
2016

 
2015

Benefit Plans: (1)
 
 
 
 
 
 
Net loss
 
$
325

 
$
223

 
$
304

Prior service cost/credit
 
(34
)
 
(45
)
 
(32
)
 
 
291

 
178

 
272

AB InBev/SABMiller (2)
 
8

 
1,160

 
21

Pre-tax amounts reclassified from accumulated other comprehensive losses to net earnings
 
$
299

 
$
1,338

 
$
293

(1) Amounts are included in net defined benefit plan costs. For further details, see Note 16. Benefit Plans.
(2) For the years ended December 31, 2017 and 2015, amounts are included in earnings from equity investment in AB InBev/SABMiller. Substantially all of the amount for the year ended December 31, 2016 is included in gain on AB InBev/SABMiller business combination. For further information, see Note 6. Investment in AB InBev/SABMiller.
Note 14. Income Taxes
As a result of the Tax Reform Act, Altria Group, Inc. recorded net tax benefits of approximately $3.4 billion in the fourth quarter of 2017 as discussed below. The main provisions of the Tax Reform Act that impact Altria Group, Inc. include: (i) a reduction in the U.S. federal statutory corporate income tax rate from 35% to 21% effective January 1, 2018, and (ii) changes in the treatment of foreign-source income, commonly referred to as a modified territorial tax system.
The transition to a modified territorial tax system requires Altria Group, Inc. to record a deemed repatriation tax and an associated tax basis benefit in 2017. Substantially all of the deemed repatriation tax is related to Altria Group, Inc.’s share of AB InBev’s accumulated earnings. As a result of the deemed repatriation tax, no tax was due on the dividends Altria Group, Inc. received from AB InBev in 2017.
 
Earnings before income taxes and (benefit) provision for income taxes consisted of the following for the years ended December 31, 2017, 2016 and 2015: 
(in millions)
2017

 
2016

 
2015

Earnings before income taxes:
 
 
 
 
 
United States
$
9,809

 
$
21,867

 
$
8,078

Outside United States
19

 
(15
)
 

Total
$
9,828

 
$
21,852

 
$
8,078

Provision (benefit) for
income taxes:
 
 
 
 
 
Current:
 
 
 
 
 
Federal
$
2,346

 
$
4,093

 
$
2,516

State and local
366

 
390

 
451

Outside United States
15

 
6

 

 
2,727

 
4,489

 
2,967

Deferred:
 
 
 
 
 
Federal
(3,213
)
 
3,102

 
(140
)
State and local
86

 
20

 
8

Outside United States
1

 
(3
)
 

 
(3,126
)
 
3,119

 
(132
)
Total (benefit) provision for
income taxes
$
(399
)
 
$
7,608

 
$
2,835

Altria Group, Inc.’s U.S. subsidiaries join in the filing of a U.S. federal consolidated income tax return. The U.S. federal income tax statute of limitations remains open for the year 2010 and forward, with years 2014 and 2015 currently under examination by the Internal Revenue Service (“IRS”) as part of an audit conducted in the ordinary course of business. With the exception of corresponding federal audit adjustments, state statutes of limitations generally remain open for the year 2013 and forward. Certain of Altria Group, Inc.’s state tax returns are currently under examination by various states as part of routine audits conducted in the ordinary course of business.


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