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, 2016

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)	2016			2015		2014
Current:
U.S. federal	$	326		384		396
State and local	29			20		28
Foreign jurisdictions	73			75		132
Total	428			479		556
Deferred:
U.S. federal	(31		)	(86	)	(182	)
State and local	(8		)	3		(15	)
Foreign jurisdictions	(4		)	(7	)	(5	)
Total	(43		)	(90	)	(202	)
Total income tax expense	$	385		389		354

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

Pre-tax income was as follows:



	Years ended December 31,
(in millions)	2016		2015	2014
QVC-U.S.	$	859	909	827
QVC-International	168		142	160
Consolidated QVC	$	1,027	1,051	987

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,
	2016		2015		2014
Provision at statutory rate	35.0	%	35.0	%	35.0	%
State income taxes, net of federal benefit	1.3	%	1.4	%	0.9	%
Foreign taxes	(0.3	)%	0.2	%	0.6	%
Foreign earnings repatriation	0.2	%	0.2	%	(0.3	)%
Valuation allowance	1.0	%	0.9	%	0.2	%
Permanent differences	(0.6	)%	(0.2	)%	(0.5	)%
Change in tax law	1.0	%	—	%	—	%
Other, net	(0.1	)%	(0.5	)%	—	%
Total income tax expense	37.5	%	37.0	%	35.9	%

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)	2016			2015
Deferred tax assets:
Accounts receivable, principally due to the allowance for doubtful accounts and related reserves for the uncollectible accounts	$	38		33
Inventories, principally due to obsolescence reserves and additional costs of inventories for tax purposes pursuant to the Tax Reform Act of 1986	36			42
Allowance for sales returns	36			37
Deferred compensation	30			26
Unrecognized federal and state tax benefits	23			60
Accrued liabilities	79			96
Other	24			21
Subtotal	266			315
Valuation allowance	(22		)	(12	)
Total deferred tax assets	244			303
Deferred tax liabilities:
Depreciation and amortization	(1,009		)	(1,127	)
Cumulative translation of foreign currencies	(13		)	(3	)
Total deferred tax liabilities	(1,022		)	(1,130	)
Net deferred tax liability	$	(778	)	(827	)

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

A reconciliation of the 2016 beginning and ending amount of the liability for unrecognized tax benefits is as follows:



(in millions)
Balance at January 1, 2016	$	91
Increases related to prior year tax positions	14
Decreases related to prior year tax positions	(7		)
Decreases related to settlements with taxing authorities	(49		)
Increases related to current year tax positions	6
Balance at December 31, 2016	$	55