The components of our deferred tax assets and liabilities, shown before jurisdictional netting, follow: | ||||||||||||||||
2013 Deferred Tax | 2012 Deferred Tax | |||||||||||||||
(MILLIONS OF DOLLARS) | Assets | (Liabilities) | Assets | (Liabilities) | ||||||||||||
Prepaid/deferred items | $ | 1,668 | $ | (134 | ) | $ | 1,762 | $ | (113 | ) | ||||||
Inventories | 277 | (216 | ) | 315 | (195 | ) | ||||||||||
Intangible assets | 1,137 | (9,647 | ) | 1,602 | (12,585 | ) | ||||||||||
Property, plant and equipment | 376 | (1,916 | ) | 480 | (1,307 | ) | ||||||||||
Employee benefits | 3,154 | (77 | ) | 4,890 | (391 | ) | ||||||||||
Restructurings and other charges | 453 | (396 | ) | 734 | (329 | ) | ||||||||||
Legal and product liability reserves | 904 | — | 1,909 | — | ||||||||||||
Net operating loss/credit carryforwards(a) | 2,043 | — | 3,664 | — | ||||||||||||
Unremitted earnings(b) | — | (19,399 | ) | — | (17,077 | ) | ||||||||||
State and local tax adjustments | 297 | — | 385 | — | ||||||||||||
All other | 249 | (448 | ) | 722 | (496 | ) | ||||||||||
10,558 | (32,233 | ) | 16,463 | (32,493 | ) | |||||||||||
Valuation allowances | (1,288 | ) | — | (1,033 | ) | — | ||||||||||
Total deferred taxes | $ | 9,270 | $ | (32,233 | ) | $ | 15,430 | $ | (32,493 | ) | ||||||
Net deferred tax liability(c), (d) | $ | (22,963 | ) | $ | (17,063 | ) | ||||||||||
(a) | The amount in 2013 is shown after reduction for unrecognized tax benefits of $2.3 billion, where we have net operating loss carryforwards, similar tax losses, and/or tax credit carryforwards that are available, under the tax law of the applicable jurisdiction, to settle any additional income taxes that would result from the disallowance of a tax position. For additional information, see "Adoption of New Accounting Standard" in Note 5D. Tax Matters: Tax Contingencies. |
(b) | The increase in 2013 reflects additional accruals for certain funds earned outside the U.S. that will not be indefinitely reinvested overseas, virtually all of which were earned in the current year. For additional information, see Note 5A. Tax Matters: Taxes on Income from Continuing Operations. |
(c) | 2013 v. 2012––The net deferred tax liability position increased, reflecting an increase in noncurrent deferred tax liabilities related to unremitted earnings, as well as a decrease in deferred tax assets related to net operating loss and credit carryforwards as a result of the adoption of a new accounting standard, a decrease in current deferred tax assets related to product liability reserves due to settlements, and the decrease in noncurrent deferred tax assets related to employee benefits, partially offset by the reduction in noncurrent deferred tax liabilities resulting from the amortization of identifiable intangible assets. For additional information, see Note 5D. Tax Matters: Tax Contingencies. |
(d) | In 2013, included in Current deferred tax assets and other current tax assets ($2.1 billion), Noncurrent deferred tax assets and other noncurrent tax assets ($569 million), Other current liabilities ($52 million) and Noncurrent deferred tax liabilities ($25.6 billion). In 2012, included in Current deferred tax assets and other current tax assets ($3.5 billion), Noncurrent deferred tax assets and other noncurrent tax assets ($611 million) and Noncurrent deferred tax liabilities ($21.2 billion). |