Qurate Retail, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Income Taxes Income Tax (Tables)

Income Taxes Income Tax (Tables)

12 Months Ended

Dec. 31, 2015

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]

Income tax expense (benefit) consisted of the following:



	Years ended December 31,
(in millions)	2015			2014		2013
Current:
U.S. federal	$	384		396		361
State and local	20			28		22
Foreign jurisdictions	75			132		78
Total	479			556		461
Deferred:
U.S. federal	(86		)	(182	)	(107	)
State and local	3			(15	)	(7	)
Foreign jurisdictions	(7		)	(5	)	6
Total	(90		)	(202	)	(108	)
Total income tax expense	$	389		354		353

Schedule of Income before Income Tax, Domestic and Foreign [Table Text Block]

Pre-tax income was as follows:



	Years ended December 31,
(in millions)	2015		2014	2013
QVC-U.S.	$	909	827	824
QVC-International	142		160	162
Consolidated QVC	$	1,051	987	986

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

Total income tax expense differs from the amounts computed by applying the U.S. federal income tax rate of 35% as a result of the following:



	Years ended December 31,
	2015		2014		2013
Provision at statutory rate	35.0	%	35.0	%	35.0	%
State income taxes, net of federal benefit	1.4	%	0.9	%	0.7	%
Foreign taxes	0.2	%	0.6	%	0.6	%
Foreign earnings repatriation	0.2	%	(0.3	)%	(0.4	)%
Valuation allowance	0.9	%	0.2	%	—	%
Permanent differences	(0.2	)%	(0.5	)%	—	%
Other, net	(0.5	)%	—	%	(0.1	)%
Total income tax expense	37.0	%	35.9	%	35.8	%

Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

The tax effects of temporary differences that gave rise to significant portions of the deferred income tax assets and deferred income tax liabilities are presented below:



	December 31,
(in millions)	2015			2014
Deferred tax assets:
Accounts receivable, principally due to the allowance for doubtful accounts and related reserves for the uncollectible accounts	$	33		$	33
Inventories, principally due to obsolescence reserves and additional costs of inventories for tax purposes pursuant to the Tax Reform Act of 1986	42			33
Allowance for sales returns	37			41
Deferred compensation	26			43
Unrecognized federal and state tax benefits	60			63
Accrued liabilities	96			82
Other	21			27
Subtotal	315			322
Valuation allowance	(12		)	(3		)
Total deferred tax assets	303			319
Deferred tax liabilities:
Depreciation and amortization	(1,127		)	(1,222		)
Cumulative translation of foreign currencies	(3		)	(8		)
Total deferred tax liabilities	(1,130		)	(1,230		)
Net deferred tax liability	$	(827	)	$	(911	)

Summary of Positions for which Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Table Text Block]

A reconciliation of the 2015 beginning and ending amount of the liability for unrecognized tax benefits is as follows:



(in millions)
Balance at January 1, 2015	$	123
Increases related to prior year tax positions	—
Decreases related to prior year tax positions	(11		)
Decreases related to settlements with taxing authorities	(35		)
Increases related to current year tax positions	14
Balance at December 31, 2015	$	91