Time Warner Cable 2008 Annual Report Download - page 129
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TKCCP Joint Venture
Texas and Kansas City Cable Partners, L.P. (“TKCCP”) was a 50-50 joint venture between a consolidated
subsidiary of TWC (TWE-A/N) and Comcast. On January 1, 2007, TKCCP distributed its assets to its partners.
TWC received certain cable assets located in Kansas City, south and west Texas and New Mexico (the “Kansas City
Pool”), which served approximately 788,000 basic video subscribers as of December 31, 2006, and Comcast
received the pool of assets consisting of the Houston cable systems (the “Houston Pool”), which served approx-
imately 795,000 basic video subscribers as of December 31, 2006. TWC began consolidating the results of the
Kansas City Pool on January 1, 2007. TKCCP was formally dissolved on May 15, 2007. For accounting purposes,
TWC treated the distribution of TKCCP’s assets as a sale of TWC’s 50% equity interest in the Houston Pool and as
an acquisition of Comcast’s 50% equity interest in the Kansas City Pool. As a result of the sale of TWC’s 50%
equity interest in the Houston Pool, TWC recorded a pretax gain of $146 million in the first quarter of 2007, which is
included as a component of other income, net, in the consolidated statement of operations for the year ended
December 31, 2007.
11. INCOME TAXES
TWC is not a separate taxable entity for U.S. federal and various state income tax purposes and its results are
included in the consolidated U.S. federal and certain state income tax returns of Time Warner. The following
income tax information has been prepared assuming TWC was a stand-alone taxpayer for all periods presented.
Current and deferred income taxes (tax benefits) provided on income from continuing operations are as follows
(in millions):
2008 2007 2006
Year Ended December 31,
Federal:
Current .......................................... $ (188) $ 356 $ 324
Deferred ......................................... (3,636) 266 196
State:
Current .......................................... 39 67 56
Deferred ......................................... (921) 51 44
Total ............................................ $ (4,706) $ 740 $ 620
The differences between income taxes (tax benefits) expected at the U.S. federal statutory income tax rate of
35% and income taxes (tax benefits) provided are as set forth below (in millions):
2008 2007 2006
Year Ended December 31,
Taxes (tax benefits) on income at U.S. federal statutory rate ..... $ (4,218) $ 652 $ 545
State and local taxes (tax benefits), net of federal tax effects..... (574) 77 69
Other ............................................. 86 11 6
Total .............................................. $ (4,706) $ 740 $ 620
119
TIME WARNER CABLE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)