Income Taxes (Notes)

9 Months Ended

Sep. 30, 2020

Income Tax Disclosure [Abstract]

Income Taxes

8.  Income Taxes

Income tax expense included in our accompanying consolidated statements of operations is as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2020			2019			2020			2019
	(In millions, except percentages)
Income tax expense	$	140		$	151		$	304		$	471
Effective tax rate	22.9		%	22.6		%	(218.7)		%	22.6		%

The effective tax rate for the three months ended September 30, 2020 is higher than the statutory federal rate of 21% primarily due to state income taxes.

The effective tax rate for the nine months ended September 30, 2020 is “negative” and lower than the statutory federal rate of 21% primarily due to the $1,600 million CO₂ and Natural Gas Pipelines Non-Regulated reporting units’ impairment of non-tax deductible goodwill contributing to our loss before income taxes but not providing a tax benefit. While we would normally expect a federal income tax benefit from our loss before income taxes, because a tax benefit is not allowed on the goodwill impairment, we incurred an income tax expense for the period, partially offset by the refund of alternative minimum tax

sequestration credits and dividend-received deductions from our investments in Citrus Corporation (Citrus) and Plantation Pipe Line Company (Plantation).

The effective tax rate for the three and nine months ended September 30, 2019 is higher than the statutory federal rate of 21% primarily due to state and foreign taxes, partially offset by dividend-received deductions from our investments in Citrus, NGPL Holdings LLC and Plantation.