Income Taxes

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income taxes

Income Taxes

The components of income before income taxes from continuing operations for each of the years ended December 31 were as follows:

	2021		2020		2019
	(In thousands)
United States	$	466,651	$	474,856	$	398,532
Foreign	—		261		(87)
Income before income taxes from continuing operations	$	466,651	$	475,117	$	398,445

Income tax expense (benefit) from continuing operations for the years ended December 31 was as follows:

	2021		2020		2019
	(In thousands)
Current:
Federal	$	17,121	$	65,006	$	(3,502)
State	11,549		21,234		3,366
Foreign	—		151		—
	28,670		86,391		(136)
Deferred:
Income taxes:
Federal	45,885		(3,735)		50,218
State	12,610		(625)		12,098
Investment tax credit - net	1,755		2,559		1,099
	60,250		(1,801)		63,415
Total income tax expense	$	88,920	$	84,590	$	63,279

Components of deferred tax assets and deferred tax liabilities at December 31 were as follows:

	2021		2020
	(In thousands)
Deferred tax assets:
Postretirement	$	45,752	$	51,495
Compensation-related	37,917		40,477
Operating lease liabilities	26,710		25,963
Asset retirement obligations	8,696		8,060
Legal and environmental contingencies	8,603		9,467
Customer advances	7,683		7,463
Payroll tax deferral	6,940		14,010
Other	39,960		37,944
Total deferred tax assets	182,261		194,879
Deferred tax liabilities:
Basis differences on property, plant and equipment	585,095		536,966
Postretirement	48,302		49,233
Operating lease right-of-use-assets	26,570		25,858
Intangible assets	21,074		19,514
Other	81,070		67,922
Total deferred tax liabilities	762,111		699,493
Valuation allowance	12,112		11,484
Net deferred income tax liability	$	591,962	$	516,098

As of December 31, 2021 and 2020, the Company had various state income tax net operating loss carryforwards of $164.8 million and $151.5 million, respectively, and federal and state income tax credit carryforwards, excluding alternative minimum tax credit carryforwards, of $35.6 million and $37.1 million, respectively. The state credits include various regulatory investment tax credits of approximately $35.0 million and $36.3 million at December 31, 2021 and 2020, respectively. The state income tax credit carryforwards are due to expire between 2024 and 2035. Changes in tax regulations or assumptions regarding current and future taxable income could require additional valuation allowances in the future.

The following table reconciles the change in the net deferred income tax liability from December 31, 2020, to December 31, 2021, to deferred income tax expense:

	2021
(In thousands)
Change in net deferred income tax liability from the preceding table	$	75,864
Deferred taxes associated with other comprehensive loss	(2,355)
Excess deferred income tax amortization	(10,295)
Other	(2,964)
Deferred income tax expense for the period	$	60,250

Total income tax expense differs from the amount computed by applying the statutory federal income tax rate to income before taxes. The reasons for this difference were as follows:

Years ended December 31,	2021			2020			2019
	Amount		%	Amount		%	Amount		%
	(Dollars in thousands)
Computed tax at federal statutory rate	$	97,997	21.0	$	99,775	21.0	$	83,674	21.0
Increases (reductions) resulting from:
State income taxes, net of federal income tax	19,496		4.2	17,845		3.8	14,029		3.5
Federal renewable energy credit	(13,914)		(3.0)	(16,009)		(3.4)	(15,843)		(4.0)
Tax compliance and uncertain tax positions	(477)		(.1)	(3,543)		(.7)	(2,739)		(.7)
Excess deferred income tax amortization	(10,295)		(2.2)	(12,517)		(2.6)	(11,904)		(3.0)
Other	(3,887)		(.8)	(961)		(.3)	(3,938)		(.9)
Total income tax expense	$	88,920	19.1	$	84,590	17.8	$	63,279	15.9

The Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction, and various state, local and foreign jurisdictions. The Company is no longer subject to U.S. federal or non-U.S. income tax examinations by tax authorities for years ending prior to 2018. With few exceptions, as of December 31, 2021, the Company is no longer subject to state and local income tax examinations by tax authorities for years ending prior to 2018.

For the years ended December 31, 2021, 2020 and 2019, total reserves for uncertain tax positions were not material. The Company recognizes interest and penalties accrued relative to unrecognized tax benefits in income tax expense.