XML 30 R12.htm IDEA: XBRL DOCUMENT
v3.23.3

Income Taxes | 9 Months Ended
--- | ---
Sep. 30, 2023
Income Tax Disclosure [Abstract] |
Income Taxes | 5. Income Taxes Reconciliations of income tax expense (benefit) for the periods ended September 30 are as follows.
(PPL)
| Three Months |  | Nine Months
| 2023 |  | 2022 |  | 2023 |  | 2022
Federal income tax on Income Before Income Taxes at statutory tax rate - 21% | $ | 60 |  |  | $ | 45 |  |  | $ | 167 |  |  | $ | 150 |
Increase (decrease) due to: |  |  |  |  |  |  |
State income taxes, net of federal income tax benefit | 16 |  |  | 8 |  |  | 49 |  |  | 56 |
Valuation allowance adjustments | 1 |  |  | (1) |  |  | 6 |  |  | 9 |
Income tax credits (a) | (9) |  |  | (1) |  |  | (11) |  |  | (3) |
Amortization of investment tax credit including deferred taxes on basis adjustment | (1) |  |  | — |  |  | (2) |  |  | (7) |
Depreciation and other items not normalized | (2) |  |  | — |  |  | (9) |  |  | (8) |
Amortization of excess deferred federal and state income taxes | (13) |  |  | (7) |  |  | (33) |  |  | (47) |
Federal and state income tax return adjustments | 3 |  |  | — |  |  | (2) |  |  | (1) |
State income tax rate change (b) | 1 |  |  | (5) |  |  | — |  |  | (5) |
Other | 2 |  |  | 2 |  |  | 5 |  |  | 3 |
Total increase (decrease) | (2) |  |  | (4) |  |  | 3 |  |  | (3) |
Total income tax expense (benefit) | $ | 58 |  |  | $ | 41 |  |  | $ | 170 |  |  | $ | 147 |
(a) The three and nine month periods ended September 30, 2023 primarily include a deferred tax benefit from renewable tax credits that will be acquired at a discount. (b) The three and nine months ended September 30, 2022 include a deferred tax benefit of $5 million, due to the corporate net income tax rate reduction. See "Pennsylvania State Tax Reform" below for additional information.
(PPL Electric) |  |  |  |  |  |  |
| Three Months |  | Nine Months
| 2023 |  | 2022 |  | 2023 |  | 2022
Federal income tax on Income Before Income Taxes at statutory tax rate - 21% | $ | 38 |  |  | $ | 38 |  |  | $ | 107 |  |  | $ | 114 |
Increase (decrease) due to: |  |  |  |  |  |  |
State income taxes, net of federal income tax benefit | 13 |  |  | 14 |  |  | 36 |  |  | 43 |
Depreciation and other items not normalized | (1) |  |  | (1) |  |  | (8) |  |  | (7) |
Amortization of excess deferred federal and state income taxes | (4) |  |  | (4) |  |  | (8) |  |  | (9) |
State income tax rate change (a) | — |  |  | (9) |  |  | (1) |  |  | (9) |
Other | (3) |  |  | (1) |  |  | — |  |  | (1) |
Total increase (decrease) | 5 |  |  | (1) |  |  | 19 |  |  | 17 |
Total income tax expense (benefit) | $ | 43 |  |  | $ | 37 |  |  | $ | 126 |  |  | $ | 131 |
(a) The three and nine months ended September 30, 2022 include a deferred tax benefit of $9 million, due to the corporate net income tax rate reduction. See "Pennsylvania State Tax Reform" below for additional information.
(LG&E) |  |  |  |  |  |  |
| Three Months |  | Nine Months
| 2023 |  | 2022 |  | 2023 |  | 2022
Federal income tax on Income Before Income Taxes at statutory tax rate - 21% | $ | 21 |  |  | $ | 21 |  |  | $ | 56 |  |  | $ | 57 |
Increase (decrease) due to: |  |  |  |  |  |  |
State income taxes, net of federal income tax benefit | 4 |  |  | 4 |  |  | 10 |  |  | 11 |
Amortization of excess deferred federal and state income taxes | (3) |  |  | (3) |  |  | (9) |  |  | (17) |
Other | (1) |  |  | (1) |  |  | (2) |  |  | (2) |
Total increase (decrease) | — |  |  | — |  |  | (1) |  |  | (8) |
Total income tax expense (benefit) | $ | 21 |  |  | $ | 21 |  |  | $ | 55 |  |  | $ | 49 |
(KU) |  |  |  |  |  |  |
| Three Months |  | Nine Months
| 2023 |  | 2022 |  | 2023 |  | 2022
Federal income tax on Income Before Income Taxes at statutory tax rate - 21% | $ | 26 |  |  | $ | 25 |  |  | $ | 63 |  |  | $ | 70 |
Increase (decrease) due to: |  |  |  |  |  |  |
State income taxes, net of federal income tax benefit | 5 |  |  | 5 |  |  | 12 |  |  | 13 |
Amortization of excess deferred federal and state income taxes | (5) |  |  | (4) |  |  | (13) |  |  | (16) |
Other | (2) |  |  | (2) |  |  | (3) |  |  | (4) |
Total increase (decrease) | (2) |  |  | (1) |  |  | (4) |  |  | (7) |
Total income tax expense (benefit) | $ | 24 |  |  | $ | 24 |  |  | $ | 59 |  |  | $ | 63 |
Other Narragansett Electric Acquisition (PPL) The acquisition of Narragansett Electric on May 25, 2022 was deemed an asset acquisition for federal and state income tax purposes, as a result of PPL and National Grid making a tax election under Internal Revenue Code (IRC) §338(h)(10). Accordingly, the tax bases of substantially all of the assets acquired were increased to fair market value, which equaled net book value, thereby eliminating the related deferred tax assets and liabilities. This election resulted in tax goodwill that will be amortized for tax purposes over 15 years. Pennsylvania State Tax Reform (PPL and PPL Electric) On July 8, 2022, the Governor of Pennsylvania signed into law Pennsylvania House Bill 1342 (H.B. 1342). Among other changes to the state tax code, the bill reduces the corporate net income tax rate from 9.99% to 8.99% beginning January 1, 2023, and further reduces the rate annually by half a percentage point until the rate reaches 4.99% in 2031. Inflation Reduction Act (All Registrants) On August 16, 2022, the Inflation Reduction Act (IRA) was signed into law. Among other things, the IRA enacted a new 15% corporate "book minimum tax," which is based on adjusted GAAP pre-tax income and is only applicable to corporations whose pre-tax income exceeds a certain threshold. PPL does not expect to be subject to the book minimum tax in 2023. The Registrants will continue to assess the impacts of the IRA on their financial statements and will monitor guidance issued by the U.S. Treasury in the future. In addition, the IRA enacted numerous new tax credits, largely associated with renewable energy. IRS Revenue Procedure 2023-15 (PPL and LG&E) On April 14, 2023, the IRS issued Revenue Procedure 2023-15, which provides a safe harbor method of accounting that taxpayers may use to determine whether expenses to repair, maintain, replace, or improve natural gas transmission and distribution property must be capitalized for tax purposes. PPL and LG&E are currently reviewing the revenue procedure to determine what impact the guidance may have on their financial statements.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-13 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//740/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-14 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-21 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482526/740-270-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-17 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482603/740-30-50-2 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration