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Income Taxes (Tables) | 12 Months Ended
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Dec. 31, 2016
Income Tax Disclosure [Abstract] |
Summary of income tax expense | The following table is a summary of income tax expense for the years ended December 31:
(in millions) |  | 2016 |  | 2015 |  | 2014
Current tax expense |  | $ | 72.7 |  |  | $ | 15.1 |  |  | $ | 33.6 |
Deferred income taxes, net |  | 498.7 |  |  | 420.4 |  |  | 329.2 |
Investment tax credit, net |  | (4.9 | ) |  | (1.7 | ) |  | (1.1 | )
Total income tax expense |  | $ | 566.5 |  |  | $ | 433.8 |  |  | $ | 361.7 |
Schedule of Components of Income Tax Expense (Benefit) | The provision for income taxes for each of the years ended December 31 differs from the amount of income tax determined by applying the applicable United States statutory federal income tax rate to income before income taxes as a result of the following:
|  | 2016 |  | 2015 |  | 2014
|  |  |  | Effective |  |  |  | Effective |  |  |  | Effective
(in millions) |  | Amount |  | Tax Rate |  | Amount |  | Tax Rate |  | Amount |  | Tax Rate
Expected tax at statutory federal tax rates |  | $ | 526.4 |  |  | 35.0 | % |  | $ | 375.5 |  |  | 35.0 | % |  | $ | 332.5 |  |  | 35.0 | %
State income taxes net of federal tax benefit |  | 72.8 |  |  | 4.8 | % |  | 73.1 |  |  | 6.8 | % |  | 50.5 |  |  | 5.3 | %
Production tax credits |  | (15.7 | ) |  | (1.1 | )% |  | (17.4 | ) |  | (1.6 | )% |  | (17.4 | ) |  | (1.8 | )%
AFUDC – Equity |  | (8.8 | ) |  | (0.6 | )% |  | (7.1 | ) |  | (0.7 | )% |  | (1.9 | ) |  | (0.2 | )%
Investment tax credit restored |  | (4.9 | ) |  | (0.3 | )% |  | (1.7 | ) |  | (0.2 | )% |  | (1.1 | ) |  | (0.2 | )%
Other, net |  | (3.3 | ) |  | (0.2 | )% |  | 11.4 |  |  | 1.1 | % |  | (0.9 | ) |  | (0.1 | )%
Total income tax expense |  | $ | 566.5 |  |  | 37.6 | % |  | $ | 433.8 |  |  | 40.4 | % |  | $ | 361.7 |  |  | 38.0 | %
Components of deferred income taxes classified as net current assets and net long-term liabilities | The components of deferred income taxes as of December 31 are as follows:
(in millions) |  | 2016 |  | 2015
Deferred tax assets |  |  |  |
Future tax benefits |  | $ | 430.4 |  |  | $ | 382.8 |
Employee benefits and compensation |  | 222.0 |  |  | 229.9 |
Deferred revenues |  | 207.2 |  |  | 219.9 |
Property-related |  | 54.5 |  |  | 59.5 |
Other |  | 230.6 |  |  | 177.1 |
Total deferred tax assets |  | 1,144.7 |  |  | 1,069.2 |
Valuation allowance |  | (15.0 | ) |  | (17.1 | )
Net deferred tax assets |  | $ | 1,129.7 |  |  | $ | 1,052.1 |
Deferred tax liabilities |  |  |  |
Property-related |  | $ | 4,979.3 |  |  | $ | 4,451.5 |
Investment in transmission affiliate |  | 476.9 |  |  | 420.4 |
Employee benefits and compensation |  | 401.6 |  |  | 428.9 |
Deferred transmission costs |  | 93.1 |  |  | 76.7 |
Other |  | 325.4 |  |  | 296.9 |
Total deferred tax liabilities |  | 6,276.3 |  |  | 5,674.4 |
Deferred tax liability, net |  | $ | 5,146.6 |  |  | $ | 4,622.3 |
Components of deferred tax assets associated with federal and state tax benefit carryforwards | The components of net deferred tax assets associated with federal and state tax benefit carryforwards as of December 31, 2016 and 2015 are summarized in the tables below:
2016 (in millions) |  | Gross Value |  | Deferred Tax Effect |  | Valuation Allowance |  | Earliest Year of Expiration
Future tax benefits as of December 31, 2016 |  |  |  |  |  |  |  |
Federal net operating loss |  | $ | 407.6 |  |  | $ | 142.7 |  |  | $ | — |  |  | 2031
Federal foreign tax credit |  | — |  |  | 13.5 |  |  | (13.5 | ) |  | 2017
Other federal tax credit |  | — |  |  | 241.1 |  |  | — |  |  | 2025
Charitable contribution |  | 9.4 |  |  | 4.0 |  |  | (1.5 | ) |  | 2016
State net operating loss |  | 482.6 |  |  | 24.3 |  |  | — |  |  | 2024
State tax credit |  | — |  |  | 4.8 |  |  | — |  |  | 2016
Balance as of December 31, 2016 |  | $ | 899.6 |  |  | $ | 430.4 |  |  | $ | (15.0 | ) |  |
2015 (in millions) |  | Gross Value |  | Deferred Tax Effect |  | Valuation Allowance |  | Earliest Year of Expiration
Future tax benefits as of December 31, 2015 |  |  |  |  |  |  |  |
Federal net operating loss |  | $ | 412.3 |  |  | $ | 144.3 |  |  | $ | — |  |  | 2031
Federal foreign tax credit |  | — |  |  | 15.2 |  |  | (15.2 | ) |  | 2017
Other federal tax credit |  | — |  |  | 207.8 |  |  | — |  |  | 2025
Charitable contribution |  | 4.7 |  |  | 1.9 |  |  | (1.9 | ) |  | 2016
State net operating loss |  | 185.9 |  |  | 9.3 |  |  | — |  |  | 2024
State tax credit |  | — |  |  | 4.3 |  |  | — |  |  | 2016
Balance as of December 31, 2015 |  | $ | 602.9 |  |  | $ | 382.8 |  |  | $ | (17.1 | ) |  |
Reconciliation of the beginning and ending amount of unrecognized tax benefits | We previously adopted accounting guidance related to uncertainty in income taxes. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
(in millions) |  | 2016 |  | 2015
Balance as of January 1 |  | $ | 9.5 |  |  | $ | 7.2 |
Acquired legacy Integrys unrecognized tax benefits |  | — |  |  | 3.6 |
Additions for tax positions of prior years |  | 6.7 |  |  | 0.3 |
Additions based on tax positions related to the current year |  | 1.1 |  |  | 0.2 |
Reductions for tax positions of prior years |  | (1.0 | ) |  | (1.1 | )
Reductions due to statute of limitations |  | (1.8 | ) |  | — |
Settlements during the period |  | — |  |  | (0.7 | )
Balance as of December 31 |  | $ | 14.5 |  |  | $ | 9.5 |
Summary of income tax examinations | As of December 31, 2016, we were subject to examination by state or local tax authorities for the 2011 through 2016 tax years in our major state operating jurisdictions as follows:
Jurisdiction |  | Years
Federal |  | 2013–2016
Illinois |  | 2013–2016
Michigan |  | 2012–2016
Minnesota |  | 2014–2016
Wisconsin |  | 2011–2016

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