Income Taxes

9 Months Ended

Jun. 30, 2019

INCOME TAXES

Income tax provisions for interim quarterly periods are based on an estimated annual effective income tax rate calculated separately from the effect of significant, infrequent or unusual items related specifically to interim periods. The following summarizes income tax expense and the effective tax rate in each interim period:


	Three months ended June 30									Nine months ended June 30
(In millions)	2019			2018			2019			2018
Income tax expense	$	20		$	33		$	56		$	154
Effective tax rate percentage	23.5		%	34.0		%	23.6		%	56.0		%

The decreases in income tax expense and the effective tax rate from the prior year periods were principally driven by the prior year enactment of U.S. and Kentucky tax reform legislation, which resulted in the full benefit of lower corporate statutory income tax rates in fiscal 2019 and expense of approximately $6 million and $76 million recognized during the three and nine months ended June 30, 2018, respectively, primarily related to the remeasurement of net deferred tax assets at the lower corporate statutory income tax rates. Furthermore, a benefit of $5 million was recognized in the nine months ended June 30, 2019 related to the expected utilization of tax attributes as a result of the clarification of certain provisions of Kentucky tax reform legislation.

The Company finalized its provisional estimates of the impacts of U.S. tax reform legislation during the three months ended December 31, 2018, which resulted in no significant adjustments.