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INCOME TAXES (Tables)
 12 Months Ended
Dec. 31, 2021
Income Tax Disclosure [Abstract]  
Schedule of Effective Income Tax Rate Reconciliation
We provide our calculations of ETRs in the following table.
INCOME TAX EXPENSE (BENEFIT) AND EFFECTIVE INCOME TAX RATES
(Dollars in millions)
 Years ended December 31,
 202120202019
Sempra:
Income tax expense from continuing operations$99 $249 $315 
Income from continuing operations before income taxes and equity earnings$219 $1,489 $1,734 
Equity earnings, before income tax(1)
614 294 30 
Pretax income$833 $1,783 $1,764 
Effective income tax rate12 %14 %18 %
SDG&E:
Income tax expense$201 $190 $171 
Income before income taxes$1,020 $1,014 $945 
Effective income tax rate20 %19 %18 %
SoCalGas:
Income tax (benefit) expense$(310)$96 $120 
(Loss) income before income taxes$(736)$601 $762 
Effective income tax rate42 %16 %16 %
(1)    We discuss how we recognize equity earnings in Note 6.
We present in the table below reconciliations of net U.S. statutory federal income tax rates to our ETRs.
RECONCILIATION OF FEDERAL INCOME TAX RATES TO EFFECTIVE INCOME TAX RATES
 Years ended December 31,
 202120202019
Sempra:   
U.S. federal statutory income tax rate21 %21 %21 %
Outside basis differences9 — — 
Utility depreciation8 3 3 
Non-U.S. earnings taxed at rates different from the U.S. statutory income tax rate(1)
5 2 3 
Foreign exchange and inflation effects(2)
1 (3)4 
Valuation allowances1 (1)— 
Tax credits— (1)(2)
Excess deferred income taxes outside of ratemaking— — (4)
Compensation-related items(1)(1)— 
Impairment losses(1)1 — 
Noncontrolling interests(2)— — 
Allowance for equity funds used during construction(3)(1)(1)
Amortization of excess deferred income taxes(3)(1)(1)
Remeasurement of deferred taxes(4)— — 
State income taxes, net of federal income tax benefit(4)1 2 
Utility self-developed software expenditures(5)(3)(2)
Utility repairs expenditures(9)(4)(3)
Other, net(1)1 (2)
Effective income tax rate12 %14 %18 %
SDG&E:   
U.S. federal statutory income tax rate21 %21 %21 %
State income taxes, net of federal income tax benefit5 5 6 
Depreciation3 3 3 
Excess deferred income taxes outside of ratemaking— — (3)
Self-developed software expenditures(1)(4)(3)
Amortization of excess deferred income taxes(2)(1)(1)
Allowance for equity funds used during construction(2)(2)(1)
Repairs expenditures(4)(3)(3)
Other, net— — (1)
Effective income tax rate20 %19 %18 %
SoCalGas:   
U.S. federal statutory income tax rate21 %21 %21 %
State income taxes, net of federal income tax benefit11 2 4 
Repairs expenditures5 (7)(4)
Self-developed software expenditures5 (4)(2)
Amortization of excess deferred income taxes2 (1)(1)
Allowance for equity funds used during construction1 (1)(1)
Nondeductible expenditures— 2 — 
Excess deferred income taxes outside of ratemaking— — (5)
Depreciation(5)5 4 
Other, net2 (1)— 
Effective income tax rate42 %16 %16 %
(1)    Related to operations in Mexico.
(2)    Due to fluctuation of the Mexican peso against the U.S. dollar. We record income tax expense (benefit) from the transactional effects of foreign currency and inflation because of appreciation (depreciation) of the Mexican peso. We also recognize gains (losses) in Other Income (Expense), Net, on the Consolidated Statements of Operations from foreign currency derivatives that are partially hedging Sempra Infrastructure’s exposure to movements in the Mexican peso from its controlling interest in IEnova.
Schedule Of Geographic Components Of Income Before Income Taxes And Equity Earnings Of Certain Unconsolidated Subsidiaries
The table below presents the geographic components of pretax income.
PRETAX INCOME
(Dollars in millions)
 Years ended December 31,
 202120202019
Sempra:
By geographic components:
U.S.$346 $1,461 $1,191 
Non-U.S.487 322 573 
Total(1)
$833 $1,783 $1,764 
(1)    See the Income Tax Expense (Benefit) and Effective Income Tax Rates table above for the calculation of pretax income.
Schedule Of Components Of Income Tax Expense
The components of income tax expense are as follows.
INCOME TAX EXPENSE (BENEFIT)   
(Dollars in millions)
 Years ended December 31,
 202120202019
Sempra:   
Current:   
U.S. state$(6)$(22)$(14)
Non-U.S.183 112 140 
Total177 90 126 
Deferred:   
U.S. federal(9)157 87 
U.S. state(37)36 21 
Non-U.S.(31)(34)84 
Total(77)159 192 
Deferred investment tax credits(1)— (3)
Total income tax expense$99 $249 $315 
SDG&E:   
Current:   
U.S. federal$35 $121 $35 
U.S. state13 34 31 
Total48 155 66 
Deferred:   
U.S. federal99 11 75 
U.S. state54 25 32 
Total153 36 107 
Deferred investment tax credits— (1)(2)
Total income tax expense$201 $190 $171 
SoCalGas:   
Current:   
U.S. federal$134 $163 $8 
U.S. state50 45 24 
Total184 208 32 
Deferred:   
U.S. federal(334)(85)79 
U.S. state(159)(28)10 
Total(493)(113)89 
Deferred investment tax credits(1)1 (1)
Total income tax (benefit) expense$(310)$96 $120 
Schedule Of Components Of Deferred Tax Assets And Liabilities
The tables below present the components of deferred income taxes:
DEFERRED INCOME TAXES – SEMPRA
(Dollars in millions)
 December 31,
 202120202019
Deferred income tax liabilities:  
Differences in financial and tax bases of fixed assets, investments and other assets(1)
$5,230 $4,891 $4,052 
U.S. state and non-U.S. withholding tax on repatriation of foreign earnings47 46 153 
Regulatory balancing accounts538 587 468 
Right-of-use assets – operating leases160 144 131 
Property taxes52 51 44 
Other deferred income tax liabilities50 40 93 
Total deferred income tax liabilities6,077 5,759 4,941 
Deferred income tax assets:  
Tax credits1,135 1,161 1,136 
Net operating losses706 1,299 911 
Postretirement benefits30 162 200 
Compensation-related items164 169 161 
Operating lease liabilities140 125 131 
Other deferred income tax assets130 97 60 
State income taxes21 20 8 
Bad debt allowance33 35 4 
Accrued expenses not yet deductible575 130 52 
Deferred income tax assets before valuation allowances2,934 3,198 2,663 
Less: valuation allowances183 174 144 
Total deferred income tax assets2,751 3,024 2,519 
Net deferred income tax liability(2)
$3,326 $2,735 $2,422 
(1)    In addition to the financial over tax basis differences in fixed assets, the amount also includes financial over tax basis differences in various interests in partnerships and certain subsidiaries.
(2)    At December 31, 2021, 2020, and 2019, includes $151, $136, and $155, respectively, recorded as a noncurrent asset and $3,477, $2,871, and $2,577, respectively, recorded as a noncurrent liability on the Consolidated Balance Sheets.

DEFERRED INCOME TAXES – SDG&E AND SOCALGAS
(Dollars in millions)
 SDG&ESoCalGas
 December 31,December 31,
 202120202019202120202019
Deferred income tax liabilities:    
Differences in financial and tax bases of utility plant and other assets$1,970 $1,833 $1,735 $1,444 $1,322 $1,246 
Regulatory balancing accounts323 224 141 215 362 327 
Right-of-use assets – operating leases52 28 32 16 21 22 
Property taxes35 34 30 17 17 14 
Other1 2 14 1 1 1 
Total deferred income tax liabilities2,381 2,121 1,952 1,693 1,723 1,610 
Deferred income tax assets:    
Tax credits5 5 6 3 3 3 
Postretirement benefits— 14 37 18 123 120 
Compensation-related items12 12 6 33 36 25 
Operating lease liabilities52 28 32 16 21 22 
Bad debt allowance16 18 3 15 15 1 
State income taxes4 8 7 12 11 8 
Accrued expenses not yet deductible16 14 9 539 93 15 
Other1 3 4 18 15 13 
Total deferred income tax assets106 102 104 654 317 207 
Net deferred income tax liability$2,275 $2,019 $1,848 $1,039 $1,406 $1,403 
Summary of Tax Credit Carryforwards
The following table summarizes our unused NOLs and tax credit carryforwards.
NET OPERATING LOSSES AND TAX CREDIT CARRYFORWARDS
(Dollars in millions)
Unused amount at December 31, 2021Year expiration begins
Sempra:
U.S. federal:
NOLs(1)
$3,263 
Indefinite
General business tax credits(1)
436 2032
Foreign tax credits(2)
688 2024
U.S. state(2):
NOLs
2,938 2022
General business tax credits
6 2022
Non-U.S.(2) – NOLs
248 2022
(1)    We have recorded deferred income tax benefits on these NOLs and tax credits, in total, because we currently believe they will be realized on a more-likely-than-not-basis.
(2)    We have not recorded deferred income tax benefits on a portion of these NOLs and tax credits because we currently believe they will not be realized on a more-likely-than-not-basis, as discussed below.
Summary of Operating Loss Carryforwards
The following table summarizes our unused NOLs and tax credit carryforwards.
NET OPERATING LOSSES AND TAX CREDIT CARRYFORWARDS
(Dollars in millions)
Unused amount at December 31, 2021Year expiration begins
Sempra:
U.S. federal:
NOLs(1)
$3,263 
Indefinite
General business tax credits(1)
436 2032
Foreign tax credits(2)
688 2024
U.S. state(2):
NOLs
2,938 2022
General business tax credits
6 2022
Non-U.S.(2) – NOLs
248 2022
(1)    We have recorded deferred income tax benefits on these NOLs and tax credits, in total, because we currently believe they will be realized on a more-likely-than-not-basis.
(2)    We have not recorded deferred income tax benefits on a portion of these NOLs and tax credits because we currently believe they will not be realized on a more-likely-than-not-basis, as discussed below.
Summary of Valuation Allowance The following table provides the valuation allowances that we recorded against a portion of our total deferred income tax assets shown above in the “Deferred Income Taxes – Sempra” table.
VALUATION ALLOWANCES
(Dollars in millions)
December 31,
202120202019
Sempra:
U.S. federal
$128 $118 $90 
U.S. state
31 32 33 
Non-U.S.
24 24 21 
$183 $174 $144 
Summary of Income Tax Contingencies
Following is a reconciliation of the changes in unrecognized income tax benefits and the potential effect on our ETR for the years ended December 31:
RECONCILIATION OF UNRECOGNIZED INCOME TAX BENEFITS
(Dollars in millions)
 202120202019
Sempra:   
Balance at January 1$99 $93 $119 
Increase in prior period tax positions3 3 5 
Decrease in prior period tax positions(2)(1)— 
Increase in current period tax positions204 4 2 
Settlements with taxing authorities— — (32)
Expiration of statutes of limitations— — (1)
Balance at December 31$304 $99 $93 
Of December 31 balance, amounts related to tax positions that if recognized
in future years would
   
decrease the effective tax rate(1)
$(105)$(87)$(81)
increase the effective tax rate(1)
34 31 27 
SDG&E:   
Balance at January 1$13 $12 $11 
Increase in prior period tax positions1 1 1 
Balance at December 31$14 $13 $12 
Of December 31 balance, amounts related to tax positions that if recognized
in future years would
   
decrease the effective tax rate(1)
$(11)$(10)$(9)
increase the effective tax rate(1)
1 1 1 
SoCalGas:   
Balance at January 1$68 $64 $61 
Increase in prior period tax positions1 1 1 
Increase in current period tax positions3 3 2 
Balance at December 31$72 $68 $64 
Of December 31 balance, amounts related to tax positions that if recognized
in future years would
   
decrease the effective tax rate(1)
$(63)$(59)$(55)
increase the effective tax rate(1)
33 30 26 
(1)    Includes temporary book and tax differences that are treated as flow-through for ratemaking purposes, as discussed above.
Summary of Positions for which Significant Change in Unrecognized Tax Benefits is Reasonably Possible
It is reasonably possible that within the next 12 months, unrecognized income tax benefits could decrease due to the following:
POSSIBLE DECREASES IN UNRECOGNIZED INCOME TAX BENEFITS WITHIN 12 MONTHS
(Dollars in millions)
 At December 31,
 202120202019
Sempra:   
Potential resolution of audit issues with various U.S. federal, state and local
and non-U.S. taxing authorities
$8 $8 $8 
SDG&E:   
Potential resolution of audit issues with various U.S. federal, state and local
taxing authorities
$6 $6 $6 
SoCalGas:   
Potential resolution of audit issues with various U.S. federal, state and local
taxing authorities
$2 $2 $2