Corning 2007 Annual Report

6. Income Taxes (continued)
The tax effects of temporary differences and carryforwards that gave rise to significant portions of the deferred tax assets and
liabilities follows (in millions):
December 31,
2007 2006
Loss and tax credit carryforwards $ 2,145 $ 2,399
Capitalized research and development 106 142
Restructuring reserves 194 215
Postretirement medical and life benefits 303 309
Inventory 39 63
Intangible and other assets 64 64
Other accrued liabilities 398 339
Other employee benefits 117 182
Other 17
Gross deferred tax assets 3,366 3,730
Valuation allowance (3,091) (3,542)
Total deferred tax assets 275 188
Fixed assets (40) (50)
Total deferred tax liabilities (40) (50)
Net deferred tax assets $ 235 $ 138
The net deferred tax assets are included in (in millions):
December 31,
2007 2006
Current assets $ 54 $ 47
Other assets 202 114
Other current liabilities (1)
Other noncurrent liabilities (21) (22)
Net deferred tax assets $ 235 $ 138
Details on deferred tax assets for loss and tax credit carryforwards at December 31, 2007 follow (in millions):
Expiration
Amount 2008-2012 2013-2017 2018-2026 Indefinite
Net operating losses $ 1,829 $ 42 $ 40 $ 1,539 $ 208
Capital losses 55 55
Contributions 8 8
Tax credits 253 82 77 52 42
Totals as of December 31, 2007 $ 2,145 $ 187 $ 117 $ 1,591 $ 250
FAS 123 (R) prohibits the recognition of windfall tax benefits from stock-based compensation deducted on the tax return until
realized through a reduction of income tax payable. Cumulative tax benefits totaling $202 million will be recorded in additional
paid-in-capital when the net operating loss carryforward is utilized and the windfall tax benefit can be realized.
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