DTE Energy 2010 Annual Report Download - page 24

Download and view the complete annual report

Please find page 24 of the 2010 DTE Energy annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 39

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39

22
Components of income tax expense (benefit) were as follows:
(in Millions)
2010
2009
2008
Current income taxes
Federal
$ (5)
$ (21)
$ (30)
State and other income tax expense
3
4
4
Total current income taxes
(2)
(17)
(26)
Deferred federal and other income tax expense
Federal
60
56
63
State and other income tax expense
10
1
1
Total deferred income taxes
70
57
64
Total
$ 68
$ 40
$ 38
Deferred tax assets and liabilities are recognized for the estimated future tax effect of temporary differences between the tax basis of
assets or liabilities and the reported amounts in the financial statements. Deferred tax assets and liabilities are classified as current or
noncurrent according to the classification of the related assets or liabilities. Deferred tax assets and liabilities not related to assets or
liabilities are classified according to the expected reversal date of the temporary differences. Consistent with rate making treatment,
deferred taxes are offset in the table below for temporary differences which have related regulatory assets and liabilities.
Deferred income tax assets (liabilities) were comprised of the following at December 31:
(in Millions)
2010
2009
Property, plant and equipment
$ (341)
$ (201)
Pension and benefits
(127)
(108)
Net operating loss
76
—
Other comprehensive income
1
1
Other, net
(25)
(9)
$ (416)
$ (317)
Current deferred income tax assets
$ 38
$ 46
Long term deferred income tax liabilities
(454)
(363)
$ (416)
$ (317)
Deferred income tax liabilities
$ (935)
$ (797)
Deferred income tax assets
519
480
$ (416)
$ (317)
The above table excludes unamortized investment tax credits of $9 million and $10 million at December 31, 2010 and 2009,
respectively. Investment tax credits are deferred and amortized to income over the average life of the related property.
Uncertain Tax Positions
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
(in Millions)
2010
2009
Balance at January 1
$ 12
$ 11
Additions for tax positions of current years
—
2
Reductions for tax positions of prior years
(1)
(1)
Settlements
(9)
—
Balance at December 31
$ 2
$ 12
Unrecognized tax benefits at December 31, 2010, if recognized, would not have a significant impact on our effective rate.