Income Taxes And Tax-Related Items |
6 Months Ended |
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Jun. 30, 2025 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes and Tax-Related Items | INCOME TAXES AND TAX-RELATED ITEMS Unrecognized tax benefits were $8 million at both June 30, 2025 and December 31, 2024. The Corporation anticipates a decrease of $2 million in net unrecognized tax benefits within the next twelve months. Included in accrued expenses and other liabilities on the Consolidated Balance Sheets was a liability of $1 million for tax-related interest and penalties at both June 30, 2025 and December 31, 2024. Net deferred tax assets were $819 million at June 30, 2025, compared to $1.0 billion at December 31, 2024. The decrease of approximately $215 million in net deferred tax assets resulted primarily from a decrease to deferred tax assets related to hedging gains and losses, net unrealized losses on investment securities available-for-sale and other timing differences. Included in deferred tax assets at both June 30, 2025 and December 31, 2024 were $2 million of state net operating loss (NOL) carryforwards and $9 million of federal foreign tax carryforwards. State NOL carryforwards expire between 2025 and 2044, and federal foreign tax credit carryforwards expire between 2029 and 2035. The Corporation believes that it is more likely than not that the benefit from federal foreign tax credits and certain state NOL carryforwards will not be realized and, accordingly, maintains a federal valuation allowance of $9 million and a state valuation allowance of $2 million at both June 30, 2025 and December 31, 2024. The determination regarding valuation allowance was based on evidence of loss carryback capacity, projected future reversals of existing taxable temporary differences to absorb the deferred tax assets and assumptions made regarding future events. In the ordinary course of business, the Corporation enters into certain transactions that have tax consequences. From time to time, the Internal Revenue Service (IRS) or other tax jurisdictions may review and/or challenge specific interpretive tax positions taken by the Corporation with respect to those transactions. The Corporation believes its tax returns were filed based upon applicable statutes, regulations and case law in effect at the time of the transactions. The IRS or other tax jurisdictions, an administrative authority or a court, if presented with the transactions, could disagree with the Corporation’s interpretation of the tax law. Based on current knowledge and probability assessment of various potential outcomes, the Corporation believes that current tax reserves are adequate, and the amount of any potential incremental liability arising is not expected to have a material adverse effect on the Corporation’s consolidated financial condition or results of operations. Probabilities and outcomes are reviewed as events unfold, and adjustments to the reserves are made when necessary.
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