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Income Taxes
 6 Months Ended
Jun. 30, 2016
Income Tax Disclosure [Abstract]  
Income Tax Disclosure [Text Block]
Income Taxes
 
The following table summarizes the significant differences in income tax expense based on the differences between our effective tax rate and the federal statutory rate (in thousands):

 
Three Months Ended
June 30,
 
2016
 
2015
Income Before Income Taxes
$
38,516

 
 
 
$
39,184

 
 
 
 
 
 
 
 
 
 
Income tax calculated at 35% federal statutory rate
13,481

 
35.0
 %
 
13,715

 
35.0
 %
 
 
 
 
 
 
 
 
Permanent or flow through adjustments:
 
 
 
 
 
 
 
State income, net of federal provisions
(1,025
)
 
(2.7
)
 
367

 
0.9

Flow-through repairs deductions
(6,971
)
 
(18.1
)
 
(4,848
)
 
(12.4
)
Production tax credits
(2,324
)
 
(6.0
)
 
(651
)
 
(1.7
)
Plant and depreciation of flow through items
(246
)
 
(0.6
)
 
(245
)
 
(0.6
)
Prior year permanent return to accrual adjustments
(128
)
 
(0.3
)
 
—

 
—

Other, net
160

 
0.4

 
(127
)
 
(0.2
)
 
(10,534
)
 
(27.3
)
 
(5,504
)
 
(14.0
)
 
 
 
 
 
 
 
 
Income Tax Expense
$
2,947

 
7.7
 %
 
$
8,211

 
21.0
 %



 
Six Months Ended
June 30,
 
2016
 
2015
Income Before Income Taxes
$
79,042

 
 
 
$
100,625

 
 
 
 
 
 
 
 
 
 
Income tax calculated at 35% federal statutory rate
27,665

 
35.0
 %
 
35,219

 
35.0
 %
 
 
 
 
 
 
 
 
Permanent or flow through adjustments:
 
 
 
 
 
 
 
State income, net of federal provisions
(2,125
)
 
(2.6
)
 
528

 
0.6

Flow-through repairs deductions
(13,645
)
 
(17.3
)
 
(14,461
)
 
(14.4
)
Production tax credits
(5,099
)
 
(6.5
)
 
(1,912
)
 
(1.9
)
Plant and depreciation of flow through items
(1,184
)
 
(1.5
)
 
(626
)
 
(0.6
)
Prior year permanent return to accrual adjustments
(128
)
 
(0.2
)
 
—

 
—

Other, net
(65
)
 
—

 
(521
)
 
(0.6
)
 
(22,246
)
 
(28.1
)
 
(16,992
)
 
(16.9
)
 
 
 
 
 
 
 
 
Income Tax Expense
$
5,419

 
6.9
 %
 
$
18,227

 
18.1
 %

We compute income tax expense for each quarter based on the estimated annual effective tax rate for the year, adjusted for certain discrete items. Our effective tax rate typically differs from the federal statutory tax rate of 35% primarily due to the regulatory impact of flowing through the federal and state tax benefit of repairs deductions, state tax benefit of accelerated tax depreciation deductions (including bonus depreciation when applicable) and production tax credits. The regulatory accounting treatment of these deductions requires immediate income recognition for temporary tax differences of this type, which is referred to as the flow-through method. When the flow-through method of accounting for temporary differences is reflected in regulated revenues, we record deferred income taxes and establish related regulatory assets and liabilities.

Uncertain Tax Positions

We recognize tax positions that meet the more-likely-than-not threshold as the largest amount of tax benefit that is greater than 50 percent likely of being realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. We have unrecognized tax benefits of approximately $91.0 million as of June 30, 2016, including approximately $66.8 million that, if recognized, would impact our effective tax rate. We do not anticipate that total unrecognized tax benefits will significantly change due to the settlement of audits or the expiration of statutes of limitation within the next twelve months.

Our policy is to recognize interest and penalties related to uncertain tax positions in income tax expense. During the six months ended June 30, 2016 we recognized $0.3 million of expense for interest and penalties in the Condensed Consolidated Statements of Income. As of June 30, 2016, we had $0.3 million of interest accrued in the Condensed Consolidated Balance Sheets. During the six months ended June 30, 2015, we did not recognize any expense for interest or penalties, and did not have any amounts accrued as of December 31, 2015, for the payment of interest and penalties.

Our federal tax returns from 2000 forward remain subject to examination by the Internal Revenue Service.