INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense (Benefit)

The significant components of income tax provision (benefit) by taxing jurisdiction were as follows:

	PG&E Corporation						Utility
	Year Ended December 31,
(in millions)	2019		2018		2017		2019		2018		2017
Current:
Federal	$	1	$	(5)	$	(10)	$	4	$	5	$	61
State	101		(8)		48		94		(7)		50
Deferred:
Federal	(2,361)		(2,264)		481		(2,363)		(2,278)		326
State	(1,136)		(1,009)		6		(1,137)		(1,009)		4
Tax credits	(5)		(6)		(14)		(5)		(6)		(14)
Income tax provision (benefit)	$	(3,400)	$	(3,292)	$	511	$	(3,407)	$	(3,295)	$	427

Schedule of Deferred Tax Assets and Liabilities

The following tables describe net deferred income tax assets and liabilities:

	PG&E Corporation				Utility
	Year Ended December 31,
(in millions)	2019		2018		2019		2018
Deferred income tax assets:
Tax carryforwards	$	1,390	$	740	$	1,308	$	650
Compensation	151		173		92		121
Income tax regulatory liability(1)	—		79		—		79
Wildfire-related claims (2)	6,520		3,433		6,520		3,433
Operating lease liability	642		—		640		—
Other (3)	112		87		121		93
Total deferred income tax assets	$	8,815	$	4,512	$	8,681	$	4,376
Deferred income tax liabilities:
Property related basis differences	7,984		7,672		7,973		7,660
Regulatory balancing accounts	381		118		381		118
Operating lease right of use asset	642		—		640		—
Income tax regulatory asset(1)	71		—		71		—
Other (4)	57		3		58		3
Total deferred income tax liabilities	$	9,135	$	7,793	$	9,123	$	7,781
Total net deferred income tax liabilities	$	320	$	3,281	$	442	$	3,405

⁽¹⁾ Represents the tax gross up portion of the deferred income tax for the cumulative differences between amounts recognized for ratemaking purposes and amounts recognized for tax, including the impact of changes in net deferred taxes associated with a lower federal income tax rate as a result of the Tax Act.  (For more information see Note 3 above).

⁽²⁾ Amounts primarily relate to wildfire-related claims, net of estimated insurance recoveries, and legal and other costs related to the 2018 Camp fire, 2017 Northern California wildfires, and the 2015 Butte fire. 

⁽³⁾ Amounts include benefits, environmental reserve, and customer advances for construction. 

(4) Amount primarily includes an environmental reserve.

Schedule of Effective Income Tax Rate Reconciliation

The following table reconciles income tax expense at the federal statutory rate to the income tax provision:

	PG&E Corporation						Utility
	Year Ended December 31,
	2019		2018		2017		2019		2018		2017
Federal statutory income tax rate	21.0	%	21.0	%	35.0	%	21.0	%	21.0	%	35.0	%
Increase (decrease) in income tax rate resulting from:
State income tax (net of federal benefit) (1)	7.5		7.9		1.5		7.5		7.9		1.6
Effect of regulatory treatment of fixed asset differences (2)	2.8		3.6		(16.5)		2.8		3.6		(16.8)
Tax credits	0.1		0.1		(1.1)		0.1		0.1		(1.1)
Compensation related (3)	—		(0.2)		(1.0)		—		(0.1)		(0.9)
Tax Reform adjustment (4)	—		0.1		6.8		—		0.1		3.0
Other, net (5)	(0.6)		—		(1.1)		(0.5)		—		(0.7)
Effective tax rate	30.8	%	32.5	%	23.6	%	30.9	%	32.6	%	20.1	%

⁽¹⁾ Includes the effect of state flow-through ratemaking treatment.

⁽²⁾ Includes the effect of federal flow-through ratemaking treatment for certain property-related costs.  For these temporary tax differences, PG&E Corporation and the Utility recognize the deferred tax impact in the current period and record offsetting regulatory assets and liabilities.  Therefore, PG&E Corporation’s and the Utility’s effective tax rates are impacted as these differences arise and reverse.  PG&E Corporation and the Utility recognize such differences as regulatory assets or liabilities as it is probable that these amounts will be recovered from or returned to customers in future rates.  In 2019 and 2018, the amounts also reflect the impact of the amortization of excess deferred tax benefits to be refunded to customers as a result of the Tax Act passed in December 2017.

⁽³⁾ Primarily represents adjustments to compensation as a result of the enactment of the Tax Act.

⁽⁴⁾ Represents adjustments to deferred tax balances under Staff Accounting Bulletin No. 118 reflecting the tax rate reduction required by the Tax Act.

⁽⁵⁾ These amounts primarily represent the impact of non-tax deductible bankruptcy costs in 2019 and tax audit settlements in 2017.

Schedule of Change in Unrecognized Tax Benefits

The following table reconciles the changes in unrecognized tax benefits:

	PG&E Corporation						Utility
(in millions)	2019		2018		2017		2019		2018		2017
Balance at beginning of year	$	377	$	349	$	388	$	377	$	349	$	382
Reductions for tax position taken during a prior year	(1)		(27)		(71)		(1)		(27)		(71)
Additions for tax position taken during the current year	44		55		48		44		55		48
Settlements	—		—		(14)		—		—		(8)
Expiration of statute	—		—		(3)		—		—		(3)
Balance at end of year	$	420	$	377	$	349	$	420	$	377	$	349

Schedule of Operating Loss and Tax Credit Carryforward Balances

The following table describes PG&E Corporation’s operating loss and tax credit carryforward balances:

(in millions)	December 31, 2019		Expiration Year
Federal:
Net operating loss carryforward - Pre-2018	$	3,940	2031 - 2036
Net operating loss carryforward - Post-2017	1,777		N/A
Tax credit carryforward	127		2029 - 2039
State:
Net operating loss carryforward	$	1,927	N/A
Tax credit carryforward	96		Various