Income Taxes |
6 Months Ended |
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Jun. 30, 2025 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | Income Taxes The effective tax rates were 16.5 percent and 17.7 percent for the three and six months ended June 30, 2025, respectively, compared to 15.6 percent and 13.9 percent for the three and six months ended June 30, 2024, respectively. The effective tax rate for the six months ended June 30, 2025 included the unfavorable tax impact of a non-deductible acquired IPR&D charge. The effective tax rates for the three and six months ended June 30, 2024 reflected the favorable tax impact of asset impairment, restructuring and other special charges. At June 30, 2025 and December 31, 2024, prepaid expenses included prepaid taxes of $16.40 billion and $7.13 billion, respectively. The U.S. examination of tax years 2019-2021 remains ongoing. For tax years 2016-2018, we are pursuing competent authority assistance through the Mutual Agreement Procedure process for the pricing of certain intercompany transactions. The resolution of both audit periods will likely extend beyond the next 12 months. Subsequent Events In July 2025, the One Big Beautiful Bill Act (OBBBA), which implements certain U.S. tax law changes that impact our business, was enacted into law. The OBBBA modified and made permanent several provisions of the Tax Cuts and Jobs Act, including reductions in scheduled increases for the rate of taxation of foreign income, immediate deductibility of U.S. research and development expenses, and reinstatement of 100% bonus depreciation for capital assets. GAAP requires that the income tax accounting effects from changes in tax laws be recognized in the reporting period in which the legislation is enacted. While we are still evaluating the impact of the newly enacted OBBBA, we currently expect it will increase our effective income tax rate to approximately 19% for the year ending December 31, 2025, while decreasing income tax payments during the second half of 2025.
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