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Income Taxes Income Taxes (Notes) | 12 Months Ended
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Dec. 31, 2018
Income Tax Disclosure [Abstract] |
Income Tax Disclosure [Text Block] | INCOME TAXES: As a partnership, we are not subject to United States federal income tax and most state income taxes. However, the Partnership conducts certain activities through corporate subsidiaries which are subject to federal and state income taxes. The components of the federal and state income tax expense (benefit) of our taxable subsidiaries were summarized as follows:
| Years Ended December 31,
| 2018 |  | 2017 |  | 2016
Current expense (benefit): |  |  |  |  |
Federal | $ | (8 | ) |  | $ | 54 |  |  | $ | (47 | )
State | 19 |  |  | (16 | ) |  | (34 | )
Total | 11 |  |  | 38 |  |  | (81 | )
Deferred expense (benefit): |  |  |  |  |
Federal | 181 |  |  | (2,055 | ) |  | (189 | )
State | (188 | ) |  | 184 |  |  | 12 |
Total | (7 | ) |  | (1,871 | ) |  | (177 | )
Total income tax expense (benefit) from continuing operations | $ | 4 |  |  | $ | (1,833 | ) |  | $ | (258 | )
Historically, our effective tax rate has differed from the statutory rate primarily due to partnership earnings that are not subject to United States federal and most state income taxes at the partnership level. A reconciliation of income tax expense at the United States statutory rate to the income tax benefit attributable to continuing operations for the years ended December 31, 2018, 2017 and 2016 is as follows:
| Years Ended December 31,
| 2018 |  | 2017 |  | 2016
Income tax expense at United States statutory rate | $ | 763 |  |  | $ | 248 |  |  | $ | 71 |
Increase (reduction) in income taxes resulting from: |  |  |  |  |
Partnership earnings not subject to tax | (635 | ) |  | (477 | ) |  | (576 | )
Goodwill impairment | — |  |  | 207 |  |  | 278 |
State tax, net of federal tax benefit | (125 | ) |  | 124 |  |  | (10 | )
Dividend received deduction | (5 | ) |  | (14 | ) |  | (15 | )
Federal rate change | — |  |  | (1,812 | ) |  | — |
Change in tax status of subsidiary | — |  |  | (124 | ) |  | — |
Other | 6 |  |  | 15 |  |  | (6 | )
Income tax expense (benefit) from continuing operations | $ | 4 |  |  | $ | (1,833 | ) |  | $ | (258 | )
Deferred taxes result from the temporary differences between financial reporting carrying amounts and the tax basis of existing assets and liabilities. The table below summarizes the principal components of the deferred tax assets (liabilities) as follows:
| December 31,
| 2018 |  | 2017
Deferred income tax assets: |  |  |
Net operating losses, alternative minimum tax credit and other carryforwards | $ | 768 |  |  | $ | 683 |
Pension and other postretirement benefits | 34 |  |  | 21 |
Long-term debt | 13 |  |  | 14 |
Other | 181 |  |  | 191 |
Total deferred income tax assets | 996 |  |  | 909 |
Valuation allowance | (96 | ) |  | (189 | )
Net deferred income tax assets | 900 |  |  | 720 |
Deferred income tax liabilities: |  |  |
Property, plant and equipment | (782 | ) |  | (1,036 | )
Investments in unconsolidated affiliates | (2,872 | ) |  | (2,726 | )
Trademarks | (63 | ) |  | (173 | )
Other | (109 | ) |  | (100 | )
Total deferred income tax liabilities | (3,826 | ) |  | (4,035 | )
Net deferred income taxes | $ | (2,926 | ) |  | $ | (3,315 | )
As of December 31, 2018, ETP Holdco had a federal net operating loss carryforward of $2.60 billion, of which $1.80 billion will expire in 2031 through 2037 while the remaining can be carried forward indefinitely. As of December 31, 2017, Sunoco Property Company LLC, a corporate subsidiary of Sunoco LP, had a federal net operating loss carryforward of $364 million. The entire net operating loss carryforward will be fully utilized to offset the taxable gain associated with the retail divestment in 2018. Our corporate subsidiaries have $31 million of federal alternative minimum tax credits at December 31, 2018, of which $16 million is expected to be reclassified to current income tax receivable in 2019 pursuant to the Tax Cuts and Jobs Act. Our corporate subsidiaries have state net operating loss carryforward benefits of $168 million, net of federal tax, which expire between 2019 and 2037. A valuation allowance of $98 million is applicable to the state net operating loss carryforward benefits primarily attributable to significant restrictions on their use in the Commonwealth of Pennsylvania. The following table sets forth the changes in unrecognized tax benefits:
| Years Ended December 31,
| 2018 |  | 2017 |  | 2016
Balance at beginning of year | $ | 609 |  |  | $ | 615 |  |  | $ | 610 |
Additions attributable to tax positions taken in the current year | 8 |  |  | — |  |  | 8 |
Additions attributable to tax positions taken in prior years | 7 |  |  | 28 |  |  | 18 |
Reduction attributable to tax positions taken in prior years | — |  |  | (25 | ) |  | (20 | )
Lapse of statute | — |  |  | (9 | ) |  | (1 | )
Balance at end of year | $ | 624 |  |  | $ | 609 |  |  | $ | 615 |
As of December 31, 2018, we have $620 million ($588 million after federal income tax benefits) related to tax positions which, if recognized, would impact our effective tax rate. Our policy is to accrue interest expense and penalties on income tax underpayments (overpayments) as a component of income tax expense. During 2018, we recognized interest and penalties of less than $6 million. At December 31, 2018, we have interest and penalties accrued of $15 million, net of tax. Sunoco, Inc. historically included certain government incentive payments as taxable income on its federal and state income tax returns. In connection with Sunoco, Inc.’s 2004 through 2011 years, Sunoco, Inc. filed amended returns with the IRS excluding these government incentive payments from federal taxable income. The IRS denied the amended returns, and Sunoco, Inc. petitioned the Court of Federal Claims (“CFC”) in June 2015 on this issue for the 2004 through 2009 years. Sunoco, Inc.’s 2010 and 2011 years are extended for this issue with the IRS. In November 2016, the CFC ruled against Sunoco, Inc., and the United States Court of Appeals for the Federal Circuit (the “Federal Circuit”) affirmed the CFC’s ruling on November 1, 2018. Sunoco, Inc. subsequently filed a petition for rehearing with the Federal Circuit, and this was denied on January 24, 2019. Sunoco, Inc. is considering further review of the Federal Circuit’s affirmation of the CFC’s ruling. If Sunoco, Inc. is ultimately fully successful in this litigation, it will receive tax refunds of approximately $530 million. However, due to the uncertainty surrounding the litigation, a reserve of $530 million was established for the full amount of the litigation. Due to the timing of the litigation and the related reserve, the receivable and the reserve for this issue have been netted in the balance sheets as of December 31, 2018 and 2017. In November 2015, the Pennsylvania Commonwealth Court determined in Nextel Communications v. Commonwealth (“Nextel”) that the Pennsylvania limitation on NOL carryforward deductions violated the uniformity clause of the Pennsylvania Constitution and struck the NOL limitation in its entirety. In October 2017, the Pennsylvania Supreme Court affirmed the decision with respect to the uniformity clause violation; however, the Court reversed with respect to the remedy and instead severed the flat-dollar limitation, leaving the percentage-based limitation intact. Nextel subsequently filed a petition for writ of certiorari with the United States Supreme Court, and this was denied on June 11, 2018. Now certain Pennsylvania taxpayers are proceeding with litigation in Pennsylvania state courts on issues not addressed by the Pennsylvania Supreme Court in Nextel, specifically, whether the Due Process and Equal Protection Clauses of the United States Constitution and the Remedies Clause of the Pennsylvania Constitution require a court to grant the taxpayer relief. Sunoco, Inc. has recognized approximately $67 million ($53 million after federal income tax benefits) in tax benefit based on previously filed tax returns and certain previously filed protective claims as relates to its cases currently held pending the Nextel matter. However, based upon the Pennsylvania Supreme Court’s October 2017 decision, and because of uncertainty in the breadth of the application of the decision, we have reserved $34 million ($27 million after federal income tax benefits) against the receivable. In general, ET and its subsidiaries are no longer subject to examination by the IRS, and most state jurisdictions, for the 2013 and prior tax years. However, Sunoco, Inc. and its subsidiaries remain subject to examination by the IRS for tax years beginning in 2007. Sunoco, Inc. has been examined by the IRS for tax years through October 4, 2012. However, statutes remain open for tax years 2007 and forward due to carryback of net operating losses and/or claims regarding government incentive payments discussed above. All other issues are resolved. Though we believe the tax years are closed by statute, tax years 2004 through 2006 are impacted by the carryback of net operating losses and under certain circumstances may be impacted by adjustments for government incentive payments. ET and its subsidiaries also have various state and local income tax returns in the process of examination or administrative appeal in various jurisdictions. We believe the appropriate accruals or unrecognized tax benefits have been recorded for any potential assessment with respect to these examinations. On December 22, 2017, the Tax Cuts and Jobs Act was signed into law. Among other provisions, the highest corporate federal income tax rate was reduced from 35% to 21% for taxable years beginning after December 31, 2017. As a result, the Partnership recognized a deferred tax benefit of $1.81 billion in December 2017. For the year ended December 31, 2018, the Partnership recorded an income tax expense due to pre-tax income at its corporate subsidiaries, partially offset by a state statutory rate reduction.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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