Income Taxes

6 Months Ended

Jun. 30, 2012

Income Taxes [Abstract]

Income Taxes

Income Taxes

During the three and six months ended June 30, 2012, the effective tax rate was 40% and 39%, respectively. The effective tax rate for 2012 was consistent with the same periods in 2011.

The following table summarizes CERC’s unrecognized tax benefits at December 31, 2011 and June 30, 2012.

	December 31, 2011			June 30,  2012
	(in millions)
Unrecognized tax benefits (expense)	$	8		$	(11	)
Portion of unrecognized tax benefits that, if recognized, would reduce the effective income tax rate	6			6
Interest accrued on unrecognized tax benefits	(4		)	(7		)

CERC does not expect the amount of unrecognized tax benefits to change materially over the 12 months ending June 30, 2013.

CenterPoint Energy has a tentative settlement with the Internal Revenue Service (IRS) for tax years 2008 and 2009 that is under review by the Joint Committee on Taxation. In May 2012, the IRS commenced its examination of CenterPoint Energy’s 2010 consolidated income tax return.