Income Taxes (Tables)

12 Months Ended

Dec. 31, 2015

Effective Income Tax Rate Reconciliation

For the year ended December 31, 2015, income tax expense was higher than the amount computed by applying the statutory federal rate. For the years ended December 31, 2014, and 2013, income tax expense was lower than the amount computed by applying the statutory federal rate to income before tax. The differences are as follows:

	FOR THE YEAR ENDED DEC. 31,
(THOUSANDS, EXCEPT FOR %)	2015			2014			2013
Income before tax	$	211,373		$	221,855		$	240,260
Statutory rate	35.0		%	35.0		%	35.0		%
Tax at federal statutory rate	$	73,981		$	77,649		$	84,091
Increase (decrease):
Plant differences, including AFUDC flowthrough	1,875			462			427
Amortization of investment tax credits	(916		)	(983		)	(1,108		)
State income taxes	1,117			23			1,094
Settlement with taxing authorities	—			(9,106		)	—
NMTC	243			(754		)	(4,806		)
Other	1,404			(175		)	(123		)
Total taxes	$	77,704		$	67,116		$	79,575
Effective Rate	36.8		%	30.3		%	33.1		%

Current and Deferred Income Tax Expense

Information about current and deferred income tax expense is as follows:

	FOR THE YEAR ENDED DEC. 31,
(THOUSANDS)	2015			2014			2013
Current federal income tax expense	$	1,284		$	11,082		$	15,672
Deferred federal income tax expense	76,219			71,061			65,237
Amortization of accumulated deferred investment tax credits	(916		)	(983		)	(1,108		)
Total federal income tax expense	$	76,587		$	81,160		$	79,801
Current state income tax expense (benefit)	3,233			(6,580		)	(978		)
Deferred state income tax (benefit) expense	(2,116		)	(7,464		)	752
Total state income tax expense (benefit)	$	1,117		$	(14,044	)	$	(226	)
Total federal and state income tax expense	$	77,704		$	67,116		$	79,575
Items charged or credited directly to shareholders’ equity
Federal deferred	3,274			(3,656		)	3,497
State deferred	528			(590		)	565
Total tax expense (benefit) from items charged directly to shareholders’ equity	$	3,802		$	(4,246	)	$	4,062
Total federal and state income tax expense	$	81,506		$	62,870		$	83,637

Deferred Tax Assets and Liabilities

The balance of accumulated deferred federal and state income tax assets and liabilities at December 31, 2015, and 2014 was comprised of the following:

	AT DEC. 31,
(THOUSANDS)	2015			2014
Depreciation and property basis differences	$	(948,597	)	$	(892,725	)
Net operating loss carryforward	12,092			56,315
NMTC	87,544			84,504
Fuel costs	(7,833		)	(11,686		)
Other comprehensive income	15,774			19,576
Regulated operations regulatory liability, net	(90,122		)	(90,135		)
Postretirement benefits other than pension	11,561			812
Other	(5,522		)	(8,734		)
Accumulated deferred federal and state income taxes	$	(925,103	)	$	(842,073	)

Liability for Unrecognized Tax Benefits

The total liability for unrecognized tax benefits for Cleco and Cleco Power at December 31, 2015, 2014, and 2013 is shown in the following table:

Cleco
(THOUSANDS)	LIABILITY FOR UNRECOGNIZED TAX BENEFITS
Balance, Jan. 1, 2013	$	3,126
Reduction for tax positions of current period	—
Additions for tax positions of prior years	2,193
Reduction for tax positions of prior years	(248		)
Reduction for settlement with tax authority	—
Reduction for lapse of statute of limitations	—
Balance, Dec. 31, 2013	$	5,071
Reduction for tax positions of current period	—
Additions for tax positions of prior years	—
Reduction for tax positions of prior years	—
Reduction for settlement with tax authority	(5,071		)
Reduction for lapse of statute of limitations	—
Balance, Dec. 31, 2014	$	—
Reduction for tax positions of current period	—
Additions for tax positions of prior years	—
Reduction for tax positions of prior years	—
Reduction for settlement with tax authority	—
Reduction for lapse of statute of limitations	—
Balance, Dec. 31, 2015	$	—

Cleco Power [Member]

Effective Income Tax Rate Reconciliation

Cleco Power

For the year ended December 31, 2015, income tax expense was higher than the amount computed by applying the statutory rate. For the years ended December 31, 2014, and

2013, income tax expense was lower than the amount computed by applying the statutory federal rate to income before tax. The differences are as follows:

	FOR THE YEAR ENDED DEC. 31,
(THOUSANDS, EXCEPT FOR %)	2015			2014			2013
Income before tax	$	220,644		$	231,290		$	229,791
Statutory rate	35.0		%	35.0		%	35.0		%
Tax at federal statutory rate	$	77,225		$	80,952		$	80,427
Increase (decrease):
Plant differences, including AFUDC flowthrough	1,875			462			427
Amortization of investment tax credits	(916		)	(983		)	(1,108		)
State income taxes	1,501			351			730
Settlement with taxing authorities	—			(2,320		)	—
Other	(391		)	(1,488		)	(1,095		)
Total taxes	$	79,294		$	76,974		$	79,381
Effective Rate	35.9		%	33.3		%	34.5		%

Current and Deferred Income Tax Expense

Information about current and deferred income tax expense is as follows:

	FOR THE YEAR ENDED DEC. 31,
(THOUSANDS)	2015			2014			2013
Current federal income tax expense  (benefit)	$	33,138		$	(197	)	$	(33	)
Deferred federal income tax expense	45,572			83,676			81,188
Amortization of accumulated deferred investment tax credits	(916		)	(983		)	(1,108		)
Total federal income tax expense	$	77,794		$	82,496		$	80,047
Current state income tax expense (benefit)	3,397			(4,161		)	(1,012		)
Deferred state income tax (benefit) expense	(1,897		)	(1,361		)	346
Total state income tax expense (benefit)	$	1,500		$	(5,522	)	$	(666	)
Total federal and state income taxes	$	79,294		$	76,974		$	79,381
Items charged or credited directly to members’ equity
Federal deferred	106			(1,137		)	2,824
State deferred	17			(184		)	456
Total tax expense (benefit) from items charged directly to member’s equity	$	123		$	(1,321	)	$	3,280
Total federal and state income tax expense	$	79,417		$	75,653		$	82,661

Deferred Tax Assets and Liabilities

The balance of accumulated deferred federal and state income tax assets and liabilities at December 31, 2015, and 2014 was comprised of the following:

	AT DEC. 31,
(THOUSANDS)	2015			2014
Depreciation and property basis differences	$	(944,675	)	$	(890,030	)
Net operating loss carryforward	18			12,323
Fuel costs	(7,833		)	(11,686		)
Other comprehensive income	9,878			10,002
Regulated operations regulatory liability, net	(90,122		)	(90,135		)
Postretirement benefits other than pension	(3,853		)	(14,346		)
Other	(6,944		)	(10,735		)
Accumulated deferred federal and state income taxes	$	(1,043,531	)	$	(994,607	)

Liability for Unrecognized Tax Benefits

Cleco Power
(THOUSANDS)	LIABILITY FOR UNRECOGNIZED TAX BENEFITS
Balance, Jan. 1, 2013	$	248
Reduction for tax positions of current period	—
Additions for tax positions of prior years	—
Reduction for tax positions of prior years	(248		)
Reduction for settlement with tax authority	—
Reduction for lapse of statute of limitations	—
Balance, Dec. 31, 2013	$	—
Reduction for tax positions of current period	—
Additions for tax positions of prior years	—
Reduction for tax positions of prior years	—
Reduction for settlement with tax authority	—
Reduction for lapse of statute of limitations	—
Balance, Dec. 31, 2014	$	—
Reduction for tax positions of current period	—
Additions for tax positions of prior years	—
Reduction for tax positions of prior years	—
Reduction for settlement with tax authority	—
Reduction for lapse of statute of limitations	—
Balance, Dec. 31, 2015	$	—