XML 29 R17.htm IDEA: XBRL DOCUMENT
v3.5.0.2

Income Taxes | 6 Months Ended
--- | ---
Jun. 30, 2016
Income Tax Disclosure [Abstract] |
INCOME TAXES | INCOME TAXES FirstEnergy’s and FES’ interim effective tax rates reflect the estimated annual effective tax rates for 2016 and 2015. These tax rates are affected by estimated annual permanent items, such as AFUDC equity and other flow-through items, as well as discrete items that may occur in any given period, but are not consistent from period to period. FirstEnergy’s effective tax rate for the three months ended June 30, 2016 and 2015 was 10.7% and 38.1%, respectively. FirstEnergy’s effective tax rate for the six months ended June 30, 2016 and 2015 was (12.2)% and 38.8%, respectively. The change in the effective tax rate for both periods is primarily due to the impairment of $800 million of goodwill (as described in Note 2), of which $433 million is non-deductible for tax purposes. Additionally, $159 million of valuation allowances were recorded against state and local NOL carryforwards that management believes, more likely than not, will not be realized based primarily on projected taxable income reflecting updates to FirstEnergy's annual long-term fundamental pricing model for energy and capacity in the second quarter of 2016 as well as certain statutory limitations on the utilization of state and local NOL carryforwards. FES’ effective tax rate for the three months ended June 30, 2016 and 2015 was 24.6% and 16.0%, respectively. FES’ effective tax rate for the six months ended June 30, 2016 and 2015 was 16.6% and 20.0%, respectively. The change in the effective tax rate for both periods is primarily due to valuation allowances of $65 million recorded against state and local NOL carryforwards that management believes, more likely than not, will not be realized as described above as well as the impairment of goodwill, of which $23 million is non-deductible for tax purposes. In March 2016, FirstEnergy recorded unrecognized tax benefits of $69 million primarily related to protective refund claims filed with the Commonwealth of Pennsylvania as a result of a recent ruling by the Commonwealth Court finding that the state’s NOL carryover limitation violated the uniformity clause and was unconstitutional. The Commonwealth of Pennsylvania has appealed this ruling to the Pennsylvania Supreme Court. As of June 30, 2016, it is reasonably possible that approximately $54 million of unrecognized tax benefits may be resolved within the next twelve months as a result of the statute of limitations expiring and expected resolution with respect to certain claims, of which approximately $15 million would affect FirstEnergy's effective tax rate. In February 2016, the IRS completed its examination of FirstEnergy’s 2014 federal income tax return and issued a full acceptance letter with no adjustments.

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/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32559-109319 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32718-109319 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32639-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32537-109319 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration