Eversource 2010 Annual Report Download - page 121

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For the Years Ended December 31,
2010 2009 2008
(Millions of Dollars, except
p
ercentages) CL&P PSNH WMECO CL&P PSNH WMECO CL&P PSNH WMECO
Income Before Income Tax
Expense $ 376.6 $ 140.9 $ 39.4 $ 335.2 $ 97.6 $ 41.1 $ 269.0 $ 80.1 $ 28.9
Statutory Federal Income Tax
Expense at 35% 131.8 49.3 13.8 117.3 34.1 14.4 94.2 28.0 10.1
Tax Effect of Differences:
Depreciation (6.1) (3.2) 0.2 (1.7) (1.2) 0.3 (11.1) (1.8) 0.1
Investment Tax Credit
Amortization (2.3) (0.1) (0.3) (2.5) (0.1) (0.3) (2.6) (0.2) (0.2)
Other Federal Tax Credits (0.1) (3.6) - (0.1) (3.7) - (1.2) (3.4) -
State Income Taxes, Net of
Federal Impact 8.5 4.7 1.6 8.9 4.3 1.6 (18.5) 2.6 1.2
Medicare Subsidy 7.8 3.8 1.5 (1.3) (0.6) (0.3) (1.5) (0.8) (0.4)
Tax Asset Valuation Allowance/
Reserve Adjustments (4.7) - - (0.8) - - 19.8 - -
Other, Net (2.5) (0.1) (0.5) (1.0) (0.8) (0.8) (1.2) (2.4) (0.2)
Income Tax Expense $ 132.4 $ 50.8 $ 16.3 $ 118.8 $ 32.0 $ 14.9 $ 77.9 $ 22.0 $ 10.6
Effective Tax Rate 35.2 % 36.1 % 41.4 % 35.4 % 32.8 % 36.3 % 28.9 % 27.5 % 36.7 %
NU, CL&P, PSNH, and WMECO file a consolidated federal income tax return and unitary, combined and separate state income tax
returns. These entities are also parties to a tax allocation agreement under which taxable subsidiaries do not pay any more taxes than
they would have otherwise paid had they filed a separate company tax return, and subsidiaries generating tax losses, if any, are paid
for their losses when utilized.
The tax effects of temporary differences that give rise to the current and long-term net accumulated deferred tax obligations are as
follows:
As of December 31,
2010 2009
(Millions of Dollars) NU NU
Deferred Tax Liabilities - Current:
Derivative Asset and Change in Fair Value of Energy Contracts $ 3.2 $ 8.5
Property Tax Accruals and Other 63.1 49.3
Total Deferred Tax Liabilities - Current 66.3 57.8
Deferred Tax Assets - Current:
Derivative Liability and Change in Fair Value of Energy Contracts 23.9 17.5
Allowance for Uncollectible Accounts and Other 91.8 50.1
Total Deferred Tax Assets - Current 115.7 67.6
Net Deferred Tax Assets - Current 49.4 9.8
Deferred Tax Liabilities - Long-Term:
Accelerated Depreciation and Other Plant-Related Differences 1,612.6 1,351.0
Regulatory Amounts:
Securitized Contract Termination Costs 65.8 101.6
Other Regulatory Deferrals 873.3 848.6
Tax Effect - Tax Regulatory Assets 177.1 179.8
Derivative Assets 44.8 71.6
Other 18.3 28.2
Total Deferred Tax Liabilities - Long-Term 2,791.9 2,580.8
Deferred Tax Assets – Long-Term:
Regulatory Deferrals 135.5 133.0
Employee Benefits 457.8 493.1
Tax Effect - Tax Regulatory Assets 17.0 25.8
Derivative Liability 352.6 374.9
Other 154.9 193.7
Total Deferred Tax Assets - Long-Term 1,117.8 1,220.5
Less: Valuation Allowance 19.8 19.8
Net Deferred Tax Assets - Long-Term 1,098.0 1,200.7
Net Deferred Tax Liabilities - Long-Term 1,693.9 1,380.1
Net Deferred Tax Liabilities $ 1,644.5 $ 1,370.3
Total Deferred Tax Assets $ 1,233.5 $ 1,288.1
Total Deferred Tax Liabilities $ 2,858.2 $ 2,638.6