Income taxes (Tables)

12 Months Ended

Dec. 31, 2018

Components of income taxes attributable to net income for common stock

The components of income taxes attributable to net income for common stock were as follows:



	HEI consolidated									Hawaiian Electric consolidated
Years ended December 31	2018			2017			2016			2018			2017			2016
(in thousands)
Federal
Current	$	42,903		$	61,534		$	59,873		$	29,649		$	36,267		$	952
Deferred*	(6,099		)	33,967			43,666			(5,245		)	35,229			70,513
Deferred tax credits, net	(12		)	(20		)	268			(12		)	(20		)	268
	36,792			95,481			103,807			24,392			71,476			71,733
State
Current	17,361			10,076			16,473			13,210			8,947			9,232
Deferred	(3,269		)	3,868			3,452			(2,737		)	2,808			3,873
Deferred tax credits, net	(87		)	(32		)	(37		)	(87		)	(32		)	(37		)
	14,005			13,912			19,888			10,386			11,723			13,068
Total	$	50,797		$	109,393		$	123,695		$	34,778		$	83,199		$	84,801


*	The 2018 deferred income tax expense includes the final adjustment to reduce the provisional amount recorded in 2017 pursuant to Staff Accounting Bulletin No. 118 (SAB No. 118). See SAB No. 118 disclosure below for details of the accounting for the enactment of the Tax Act.

Schedule of reconciliation of amount of income taxes computed at federal statutory rate

A reconciliation of the amount of income taxes computed at the federal statutory rate to the amount provided in the consolidated statements of income was as follows:



	HEI consolidated									Hawaiian Electric consolidated
Years ended December 31	2018			2017			2016			2018			2017			2016
(in thousands)
Amount at the federal statutory income tax rate	$	53,437		$	96,796		$	130,844		$	37,889		$	71,801		$	80,190
Increase (decrease) resulting from:
State income taxes, net of federal income tax benefit	11,832			9,789			13,915			8,080			7,584			8,494
Net deferred tax asset (liability) adjustment related to the Tax Act	(9,540		)	13,420			—			(9,285		)	9,168			—
Other, net	(4,932		)	(10,612		)	(21,064		)	(1,906		)	(5,354		)	(3,883		)
Total	$	50,797		$	109,393		$	123,695		$	34,778		$	83,199		$	84,801
Effective income tax rate	20.0		%	39.6		%	33.1		%	19.3		%	40.6		%	37.0		%

Schedule of deferred tax assets and liabilities

The tax effects of book and tax basis differences that give rise to deferred tax assets and liabilities were as follows:



	HEI consolidated				Hawaiian Electric consolidated
December 31	2018		2017		2018		2017
(in thousands)
Deferred tax assets
Regulatory liabilities, excluding amounts attributable to property, plant and equipment	$	104,868	$	104,984	$	104,868	$	104,984
Allowance for bad debts	14,647		16,192		659		1,812
Other	46,036		24,397		26,522		11,253
Total deferred tax assets	165,551		145,573		132,049		118,049
Deferred tax liabilities
Property, plant and equipment related	437,644		415,452		434,831		413,891
Regulatory assets, excluding amounts attributable to property, plant and equipment	37,345		38,314		37,345		38,314
Deferred RAM and RBA revenues	11,278		15,038		11,278		15,038
Retirement benefits	20,173		32,952		25,430		38,020
Other	31,629		32,247		6,362		6,827
Total deferred tax liabilities	538,069		534,003		515,246		512,090
Net deferred income tax liability	$	372,518	$	388,430	$	383,197	$	394,041

Schedule of changes in total unrecognized tax benefits

The following is a reconciliation of the Company’s liability for unrecognized tax benefits for 2018, 2017 and 2016.



	HEI consolidated									Hawaiian Electric consolidated
(in millions)	2018			2017			2016			2018			2017			2016
Unrecognized tax benefits, January 1	$	4.0		$	3.8		$	3.6		$	3.5		$	3.8		3.6
Additions based on tax positions taken during the year	0.3			0.9			—			0.3			0.4			—
Reductions based on tax positions taken during the year	—			(0.2		)	(0.1		)	—			(0.2		)	(0.1		)
Additions for tax positions of prior years	0.1			—			0.3			0.1			—			0.3
Reductions for tax positions of prior years	(0.1		)	(0.5		)	—			(0.1		)	(0.5		)	—
Lapses of statute of limitations	(2.2		)	—			—			(2.2		)	—			—
Unrecognized tax benefits, December 31	$	2.1		$	4.0		$	3.8		$	1.6		$	3.5		$	3.8