Annual report pursuant to Section 13 and 15(d)

Taxes (Tables)

Taxes (Tables)

12 Months Ended

Feb. 03, 2018

Schedule of Income Tax Expense (Benefit)

Income tax expense (benefit) is as follows:



	2017								2016							2015
	Current		Deferred			Total			Current		Deferred			Total		Current		Deferred		Total
	(millions)
Federal	$	367	$	(452	)	$	(85	)	$	433	$	(125	)	$	308	$	536	$	—	$	536
State and local	16		40			56			37		(4		)	33		72		—		72
	$	383	$	(412	)	$	(29	)	$	470	$	(129	)	$	341	$	608	$	—	$	608

Schedule of Effective Income Tax Reconciliation

The reasons for this difference and their tax effects are as follows:



	2017			2016			2015
	(millions)
Expected tax	$	512		$	333		$	587
State and local income taxes, net of federal income tax benefit (a)	19			12			43
Federal tax reform deferred tax remeasurement	(571		)	—			—
Tax impact of equity awards (a)	14			—			—
Historic rehabilitation tax credit	(5		)	(1		)	(12		)
Change in valuation allowance	18			9			3
Other	(16		)	(12		)	(13		)
	$	(29	)	$	341		$	608

Schedule of Deferred Tax Assets and Liabilities

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are as follows:



	February 3, 2018			January 28, 2017
	(millions)
Deferred tax assets
Post employment and postretirement benefits	$	188		$	405
Accrued liabilities accounted for on a cash basis for tax purposes	218			379
Long-term debt	25			63
Unrecognized state tax benefits and accrued interest	39			76
State operating loss and credit carryforwards	101			79
Other	165			347
Valuation allowance	(65		)	(36		)
Total deferred tax assets	671			1,313
Deferred tax liabilities
Excess of book basis over tax basis of property and equipment	(923		)	(1,381		)
Merchandise inventories	(389		)	(604		)
Intangible assets	(276		)	(380		)
Other	(205		)	(391		)
Total deferred tax liabilities	(1,793		)	(2,756		)
Net deferred tax liability	$	(1,122	)	$	(1,443	)

Reconciliation of the Beginning and Ending Amount of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:



	February 3, 2018			January 28, 2017			January 30, 2016
	(millions)
Balance, beginning of year	$	167		$	178		$	172
Additions based on tax positions related to the current year	7			16			30
Additions for tax positions of prior years	—			—			—
Reductions for tax positions of prior years	(23		)	(12		)	(7		)
Settlements	(2		)	(4		)	(3		)
Statute expirations	(9		)	(11		)	(14		)
Balance, end of year	$	140		$	167		$	178
Amounts recognized in the Consolidated Balance Sheets at February 3, 2018, January 28, 2017, and January 30, 2016
Current income taxes	$	11		$	6		$	12
Deferred income taxes	4			4			5
Other liabilities	125			157			161
	$	140		$	167		$	178