Entity information:
11.
Income Taxes

The components of our income tax provision in 2017, 2016 and 2015 were:
(Millions)
2017

 
2016

 
2015

Current income taxes:
 
 
 
 
 
  Federal
$
1,369

 
$
1,662

 
$
1,797

  State
73

 
129

 
112

Total current income taxes
1,442

 
1,791

 
1,909

Deferred income tax benefits:
 
 
 
 
 
  Federal
(328
)
 
(55
)
 
(59
)
  State
(27
)
 
(1
)
 
(9
)
Total deferred income tax benefits
(355
)
 
(56
)
 
(68
)
Total income taxes
$
1,087

 
$
1,735

 
$
1,841

 
 
 
 
 
 


Income taxes were different from the amount computed by applying the statutory federal income tax rate to income before income taxes as follows:
 
2017
 
2016
 
2015
(Millions)
Amount

 
Percent

 
Amount

 
Percent

 
Amount

 
Percent

Amount at statutory rate
$
1,047

 
35.0
%
 
$
1,397

 
35.0
 %
 
$
1,483

 
35.0
 %
   Health insurer fee
—

 
—
%
 
293

 
7.3
 %
 
300

 
7.1
 %
State income taxes
21

 
.7
%
 
83

 
2.1
 %
 
63

 
1.5
 %
   Other, net
19

 
.6
%
 
(38
)
 
(.9
)%
 
(5
)
 
(.1
)%
Income taxes
$
1,087

 
36.3
%
 
$
1,735

 
43.5
 %
 
$
1,841

 
43.5
 %
 
 
 
 
 
 
 
 
 
 
 
 


The significant components of our net deferred tax liabilities at December 31, 2017 and 2016 were as follows:
(Millions)
2017

 
2016

Deferred tax assets:
 
 
 
  Insurance reserves
$
187

 
$
231

  Reserve for anticipated future losses on discontinued products
135

 
225

  Employee and postretirement benefits
75

 
196

  Net operating losses
184

 
147

  Severance and facilities
32

 
135

  Investments, net
58

 
80

  Debt fair value adjustments
10

 
23

  Deferred revenue
231

 
21

  Other
116

 
117

Gross deferred tax assets
1,028

 
1,175

Less: Valuation allowance
154

 
118

Deferred tax assets, net of valuation allowance
874

 
1,057

Deferred tax liabilities:
 
 
 
  Goodwill and other acquired intangible assets
451

 
814

  Cumulative depreciation and amortization
101

 
185

  Unrealized gains on investment securities
105

 
42

  Other
22

 
20

Total gross deferred tax liabilities
679

 
1,061

Net deferred tax assets (liabilities)
$
195

 
$
(4
)
 
 
 
 


Valuation allowances are provided when we estimate that it is more likely than not that deferred tax assets will not be realized. A valuation allowance has been established primarily related to state net operating losses. We base our estimates of the future realization of deferred tax assets primarily on historic taxable income and existing deferred tax liabilities.

We participate in the Compliance Assurance Process (the “CAP”) with the Internal Revenue Service (the “IRS”). Under the CAP, the IRS undertakes audit procedures during the tax year and as the return is prepared for filing. The IRS has concluded its CAP audit of our 2016 tax return as well as all the prior years. We expect the IRS will conclude its CAP audit of our 2017 tax return in 2018.

We are also subject to audits by various state taxing authorities for tax years from 2000 through 2016. We believe we carry appropriate reserves for any exposure to state tax issues.

At both December 31, 2017 and December 31, 2016 we did not have material uncertain tax positions reflected in our Consolidated Balance Sheets.

On December 22, 2017, the TCJA was enacted. Refer to Note 2 for additional information related to the TCJA.