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Income Taxes (Tables) | 12 Months Ended
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Dec. 31, 2024
Income Tax Disclosure [Abstract] |
Income tax provision from continuing operations | The income tax provision consisted of the following amounts:
| Year Ended December 31,
(In millions, except effective income tax rate) | 2024 |  | 2023 |  | 2022
Current |  |  |  |  |
U.S. Federal | $ | 55 |  |  | $ | 26 |  |  | $ | 3 |
State | 82 |  |  | 84 |  |  | 65 |
Foreign | 5 |  |  | (12) |  |  | 3 |
Total — current | 142 |  |  | 98 |  |  | 71 |
Deferred |  |  |  |  |
U.S. Federal | 333 |  |  | 50 |  |  | 258 |
State | (134) |  |  | (61) |  |  | 59 |
Foreign | (18) |  |  | (98) |  |  | 54 |
Total — deferred | 181 |  |  | (109) |  |  | 371 |
Total income tax expense/(benefit) | $ | 323 |  |  | $ | (11) |  |  | $ | 442 |
Effective income tax rate | 22.3 | % |  | 5.2 | % |  | 26.6 | %
Domestic and foreign components of income/(loss) before income tax (benefit)/expense | The following represented the domestic and foreign components of income/(loss) before income taxes:
| Year Ended December 31,
(In millions) | 2024 |  | 2023 |  | 2022
U.S. | $ | 1,485 |  |  | $ | 261 |  |  | $ | 1,436 |
Foreign | (37) |  |  | (474) |  |  | 227 |
Total | $ | 1,448 |  |  | $ | (213) |  |  | $ | 1,663 |
Reconciliation of the U.S. federal statutory rate to NRG's effective rate | Reconciliations of the U.S. federal statutory tax rate to NRG's effective tax rate were as follows:
| Year Ended December 31,
(In millions, except effective income tax rate) | 2024 |  | 2023 |  | 2022
Income/(Loss) before income taxes | $ | 1,448 |  |  | $ | (213) |  |  | $ | 1,663 |
Tax at federal statutory tax rate | 304 |  |  | (45) |  |  | 349 |
State taxes | 92 |  |  | (22) |  |  | 69 |
Foreign rate differential | 1 |  |  | (10) |  |  | 7 |
Changes in state valuation allowances | (110) |  |  | 42 |  |  | (3) |
Nondeductible loss on Convertible Senior Notes repurchases | 56 |  |  | — |  |  | — |
Permanent differences | 23 |  |  | 31 |  |  | 17 |
Stock compensation | (19) |  |  | — |  |  | — |
Recognition of uncertain tax benefits | 1 |  |  | 12 |  |  | 8 |
Deferred impact of state tax rate changes | (24) |  |  | 3 |  |  | 14 |
Foreign tax refunds | — |  |  | (17) |  |  | — |
Return to provision adjustments | (1) |  |  | (5) |  |  | — |
Carbon capture tax credits | — |  |  | — |  |  | (19) |
Income tax expense/(benefit) | $ | 323 |  |  | $ | (11) |  |  | $ | 442 |
Effective income tax rate | 22.3 | % |  | 5.2 | % |  | 26.6 | %
Company's deferred tax assets and liabilities | The temporary differences, which gave rise to the Company's deferred tax assets and liabilities consisted of the following:
| As of December 31,
(In millions) | 2024 |  | 2023
Deferred tax assets: |  |  |
U.S. Federal net operating loss carryforwards | $ | 1,477 |  |  | $ | 1,762 |
State net operating loss carryforwards | 341 |  |  | 367 |
Foreign net operating loss carryforwards | 106 |  |  | 110 |
Deferred revenues | 335 |  |  | 347 |
Difference between book and tax basis of property | 322 |  |  | 353 |
Federal and state tax credit carryforwards | 269 |  |  | 317 |
Deferred compensation, accrued vacation and other reserves | 174 |  |  | 141 |
Interest disallowance carryforward per §163(j) of the Tax Act | 77 |  |  | 132 |
Pension and other postretirement benefits | 46 |  |  | 48 |
Allowance for credit losses | 37 |  |  | 35 |
Equity compensation | 30 |  |  | 24 |
Federal benefit on state uncertain tax positions | 13 |  |  | 13 |
Inventory obsolescence | 13 |  |  | 11 |
U.S. capital loss | 1 |  |  | 1 |
Other | 46 |  |  | 33 |
Total deferred tax assets | 3,287 |  |  | 3,694 |
Deferred tax liabilities: |  |  |
Intangibles amortization (excluding goodwill) | 486 |  |  | 726 |
Derivatives | 193 |  |  | 156 |
Capitalized contract costs | 249 |  |  | 131 |
Equity method investments | 88 |  |  | 93 |
Goodwill | 56 |  |  | 40 |
Debt discount amortization | — |  |  | 26 |
Emissions allowances | 16 |  |  | 18 |
Total deferred tax liabilities | 1,088 |  |  | 1,190 |
Total deferred tax assets less deferred tax liabilities | 2,199 |  |  | 2,504 |
Valuation allowance | (144) |  |  | (275) |
Total net deferred tax assets, net of valuation allowance | $ | 2,055 |  |  | $ | 2,229 |
Summary of NRG's net deferred tax position | The following table summarizes NRG's net deferred tax position as presented in the consolidated balance sheets:
| As of December 31,
(In millions) | 2024 |  | 2023
Deferred tax asset | $ | 2,067 |  |  | $ | 2,251 |
Deferred tax liability | (12) |  |  | (22) |
Net deferred tax asset | $ | 2,055 |  |  | $ | 2,229 |
Reconciliation of total amounts of uncertain tax benefits | The following table summarizes uncertain tax benefits activity:
| As of December 31,
(In millions) | 2024 |  | 2023
Balance as of January 1 | $ | 73 |  |  | $ | 22 |
Increase due to current year positions | 12 |  |  | 28 |
Increase due to acquired balance from Vivint Smart Home | — |  |  | 23 |
Settlements, payments and statute closure | (28) |  |  | — |
Uncertain tax benefits as of December 31 | $ | 57 |  |  | $ | 73 |

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- Definition Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 9 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-9 + Details
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