Income Taxes

12 Months Ended

Dec. 31, 2022

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:

	2022		2021		2020
	(In thousands)
United States	$	462,059	$	466,651	$	474,856
Foreign	—		—		261
Income before income taxes from continuing operations	$	462,059	$	466,651	$	475,117

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

	2022		2021		2020
	(In thousands)
Current:
Federal	$	50,747	$	17,121	$	65,006
State	20,710		11,549		21,234
Foreign	—		—		151
	71,457		28,670		86,391
Deferred:
Income taxes:
Federal	17,820		45,885		(3,735)
State	4,608		12,610		(625)
Investment tax credit - net	898		1,755		2,559
	23,326		60,250		(1,801)
Total income tax expense	$	94,783	$	88,920	$	84,590

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

	2022		2021
	(In thousands)
Deferred tax assets:
Postretirement	$	41,298	$	45,752
Compensation-related	35,196		37,917
Operating lease liabilities	25,718		26,710
Asset retirement obligations	9,687		8,696
Legal and environmental contingencies	8,526		8,603
Customer advances	7,615		7,683
Payroll tax deferral	—		6,940
Other	51,472		39,960
Total deferred tax assets	179,512		182,261
Deferred tax liabilities:
Basis differences on property, plant and equipment	608,528		585,095
Postretirement	47,340		48,302
Purchased gas adjustment	33,567		21,136
Operating lease right-of-use-assets	25,472		26,570
Intangible assets	23,007		21,074
Other	60,078		59,934
Total deferred tax liabilities	797,992		762,111
Valuation allowance	12,823		12,112
Net deferred income tax liability	$	631,303	$	591,962

As of December 31, 2022 and 2021, the Company had various state income tax net operating loss carryforwards of $176.0 million and $164.8 million, respectively, and federal and state income tax credit carryforwards, excluding alternative minimum tax credit carryforwards, of $35.7 million and $35.6 million, respectively. The state credits include various regulatory investment tax credits of approximately $35.1 million and $35.0 million at December 31, 2022 and 2021, respectively. The state income tax credit carryforwards are due to expire between 2024 and 2036. 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, 2021, to December 31, 2022, to deferred income tax expense:

	2022
(In thousands)
Change in net deferred income tax liability from the preceding table	$	39,341
Deferred taxes associated with other comprehensive loss	(3,507)
Excess deferred income tax amortization	(9,008)
Other	(3,500)
Deferred income tax expense for the period	$	23,326

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,	2022			2021			2020
	Amount		%	Amount		%	Amount		%
	(Dollars in thousands)
Computed tax at federal statutory rate	$	97,032	21.0	$	97,997	21.0	$	99,775	21.0
Increases (reductions) resulting from:
State income taxes, net of federal income tax	19,126		4.1	19,496		4.2	17,845		3.8
Federal renewable energy credit	(15,343)		(3.3)	(13,914)		(3.0)	(16,009)		(3.4)
Tax compliance and uncertain tax positions	1,080		.2	(477)		(.1)	(3,543)		(.7)
Nonqualified benefit plans	2,827		.6	(1,881)		(.4)	(2,443)		(.5)
Excess deferred income tax amortization	(9,008)		(1.9)	(10,295)		(2.2)	(12,517)		(2.6)
Other	(931)		(.2)	(2,006)		(.4)	1,482		.2
Total income tax expense	$	94,783	20.5	$	88,920	19.1	$	84,590	17.8

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 2019. With few exceptions, as of December 31, 2022, the Company is no longer subject to state and local income tax examinations by tax authorities for years ending prior to 2019.

For the years ended December 31, 2022, 2021 and 2020, 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.