Other, net

  
development expenses; settlements were included in Restructuring and other charges; and all other cost components were recorded in Other expense, net in the Statement of Consolidated Operations. Pension benefitsFor the first quarter of 2022 and 2021, the Company applied settlement accounting to certain U.S. pension plans due to lump sum payments made to participants, which resulted in settlement charges for the quarter of $1 and $3, respectively, that were recorded in Restructuring and other charges in the Statement of Consolidated Operations.On March 11, 2021, the American Rescue Plan Act of 2021 (“ARPA 2021”) was signed into law in the United States. ARPA 2021, in part, provides temporary relief for employers who sponsor defined benefit pension plans related to funding contributions under the Employee Retirement Income Security Act of 1974. For the first quarter of 2022 and 2021, Howmet’s pension contributions and other postretirement benefit payments were approximately $13 and $33, respectively.Other postretirement benefitsIn the first quarter of 2021, the Company announced a plan administration change of certain of its Medicare-eligible prescription drug benefits to an Employer Group Waiver Plan with a wrap-around secondary plan effective July 1, 2021. The administration change is expected to reduce costs to the Company through the usage of Medicare Part D and drug manufacturer subsidies. Due to this amendment, along with the associated plan remeasurements, the Company recorded a decrease to its Accrued other postretirement benefits liability of $39, which was offset in Accumulated other comprehensive loss in the Consolidated Balance Sheet.F. Other Expense, Net

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | First quarter ended |  |  |
|   | March 31, |  |  |
|  | 2022 |  | 2021 |  |  |  |  |
| Non-service related net periodic benefit cost | $ | 4  |  |  | $ | 3  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |
| Foreign currency (gains) losses, net | (3) |  |  | 2  |  |  |  |  |  |
| Net loss from asset sales | 3  |  |  | 3  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |
| Deferred compensation | (3) |  |  | 2  |  |  |  |  |  |
| Other, net | —  |  |  | (6) |  |  |  |  |  |
| Other expense, net | $ | 1  |  |  | $ | 4  |  |  |  |  |  |

G. Income TaxesThe Company’s year-to-date tax provision is comprised of the most recent estimated annual effective tax rate applied to year-to-date pre-tax ordinary income. The tax impacts of unusual or infrequently occurring items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, are recorded discretely in the interim period in which they occur. In addition, the tax provision is adjusted for the interim period impact of non-benefited pre-tax losses.The estimated annual effective tax rate, before discrete items, applied to ordinary income was 24.3% in the first quarter of 2022 and 30.4% in the first quarter of 2021. The 2022 and 2021 rates were higher than the U.S. federal statutory rate of 21% primarily due to additional estimated U.S. tax on Global Intangible Low-Taxed Income (“GILTI”) and other foreign earnings, incremental state tax and foreign taxes on earnings also subject to U.S. federal income tax, and nondeductible expenses.For the first quarter of 2022 and 2021, the tax rate including discrete items was 23.4% and 29.2%, respectively. For the first quarter of 2022, the Company recorded a discrete net tax benefit of $2 for other items. For the first quarter of 2021, the Company recorded a discrete net tax benefit of $1 for other items.The tax provision for the first quarter ended March 31, 2022 and 2021 was comprised of the following:

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | First quarter ended |  |  |
|   | March 31, |  |  |
|   | 2022 |  | 2021 |  |  |  |  |
| Pre-tax income at estimated annual effective income tax rate before discrete items | $ | 42  |  |  | $ | 34  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |
| Other discrete items | (2) |  |  | (1) |  |  |  |  |  |
| Provision for income taxes | $ | 40  |  |  | $ | 33  |  |  |  |  |  |

12
