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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

Schedule Of Effective Income Tax Rate Reconciliation



In Millions, Except Tax Rate
Years Ended December 31	2014				2013				2012
CMS Energy, including Consumers
Income from continuing operations before income taxes		$	727			$	754			$	620

Income tax expense at statutory rate			254				264				217
Increase (decrease) in income taxes from:
State and local income taxes, net of federal effect			36				37				27
Accelerated flow-through of regulatory tax benefits			(39)				-				-
Other, net			(1)				1				1
Income tax expense		$	250			$	302			$	245
Effective tax rate			34.4	%			40.1	%			39.5	%
Consumers
Income from continuing operations before income taxes		$	873			$	880			$	736

Income tax expense at statutory rate			306				308				258
Increase (decrease) in income taxes from:
State and local income taxes, net of federal effect			42				43				36
Accelerated flow-through of regulatory tax benefits			(39)				-				-
Other, net			(3)				(5)				3
Income tax expense		$	306			$	346			$	297
Effective tax rate			35.1	%			39.3	%			40.4	%

Significant Components Of Income Tax Expense Table



In Millions
Years Ended December 31	2014			2013			2012
CMS Energy, including Consumers
Current income taxes
Federal		$	-		$	-		$	1
State and local			24			34			21
		$	24		$	34		$	22
Deferred income taxes
Federal		$	198		$	248		$	205
State and local			31			23			21
		$	229		$	271		$	226
Deferred income tax credit			(3)			(3)			(3)
Tax expense		$	250		$	302		$	245
Consumers
Current income taxes
Federal		$	8		$	137		$	110
State and local			36			45			37
		$	44		$	182		$	147
Deferred income taxes
Federal		$	236		$	147		$	134
State and local			29			20			19
		$	265		$	167		$	153
Deferred income tax credit			(3)			(3)			(3)
Tax expense		$	306		$	346		$	297

Principal Components Of Deferred Income Tax Assets Table



In Millions
December 31	2014			2013
CMS Energy, including Consumers
Employee benefits		$	(72)		$	(99)
Gas inventory			(117)			(130)
Plant, property, and equipment			(2,217)			(1,856)
Net regulatory tax liability			65			86
Reserves and accruals			63			57
Securitized costs			(144)			(190)
Tax loss and credit carryforwards			676			629
Other			-			15
		$	(1,746)		$	(1,488)
Less valuation allowance			(2)			(2)
Total net deferred income tax liabilities		$	(1,748)		$	(1,490)
Deferred tax assets, net of valuation reserves		$	802		$	785
Deferred tax liabilities			(2,550)			(2,275)
Total net deferred income tax liabilities		$	(1,748)		$	(1,490)
Consumers
Employee benefits		$	(103)		$	(119)
Gas inventory			(117)			(130)
Plant, property, and equipment			(2,263)			(1,911)
Net regulatory tax liability			65			86
Reserves and accruals			34			31
Securitized costs			(144)			(190)
Tax loss and credit carryforwards			45			48
Other			(2)			16
		$	(2,485)		$	(2,169)
Less valuation allowance			(1)			(1)
Total net deferred income tax liabilities		$	(2,486)		$	(2,170)
Deferred tax assets, net of valuation reserves		$	143		$	180
Deferred tax liabilities			(2,629)			(2,350)
Total net deferred income tax liabilities		$	(2,486)		$	(2,170)

Loss And Credit Carryforwards Table



In Millions
	Gross Amount			Tax Attribute			Expiration
CMS Energy, including Consumers
Federal net operating loss carryforward		$	1,032		$	362	2025 – 2034
Local net operating loss carryforwards			406			4	2023 – 2034
State capital loss carryforward			18			1	2014
Alternative minimum tax credits			270			270	No expiration
Charitable contribution carryover			1			1	2016 – 2019
General business credits			38			38	2018 – 2034
Total tax attributes					$	676
Consumers
Federal net operating loss carryforward		$	125		$	44	2025 – 2034
State capital loss carryforward			10			1	2014
Charitable contribution carryover			1			-	2016 – 2019
Total tax attributes					$	45

Reconciliation Of Beginning And Ending Uncertain Tax Benefits Table



In Millions
Years Ended December 31	2014			2013			2012
CMS Energy, including Consumers
Balance at beginning of period		$	4		$	1		$	4
Additions for current-year tax positions			2			-			-
Additions for prior-year tax positions			1			3			1
Reductions for prior-year tax positions			(2)			-			(4)
Balance at end of period		$	5		$	4		$	1
Consumers
Balance at beginning of period		$	4		$	1		$	4
Additions for current-year tax positions			2			-			-
Additions for prior-year tax positions			1			3			1
Reductions for prior-year tax positions			(2)			-			(4)
Balance at end of period		$	5		$	4		$	1

Consumers Energy Company [Member]

Schedule Of Effective Income Tax Rate Reconciliation



In Millions, Except Tax Rate
Years Ended December 31	2014				2013				2012
CMS Energy, including Consumers
Income from continuing operations before income taxes		$	727			$	754			$	620

Income tax expense at statutory rate			254				264				217
Increase (decrease) in income taxes from:
State and local income taxes, net of federal effect			36				37				27
Accelerated flow-through of regulatory tax benefits			(39)				-				-
Other, net			(1)				1				1
Income tax expense		$	250			$	302			$	245
Effective tax rate			34.4	%			40.1	%			39.5	%
Consumers
Income from continuing operations before income taxes		$	873			$	880			$	736

Income tax expense at statutory rate			306				308				258
Increase (decrease) in income taxes from:
State and local income taxes, net of federal effect			42				43				36
Accelerated flow-through of regulatory tax benefits			(39)				-				-
Other, net			(3)				(5)				3
Income tax expense		$	306			$	346			$	297
Effective tax rate			35.1	%			39.3	%			40.4	%

Significant Components Of Income Tax Expense Table



In Millions
Years Ended December 31	2014			2013			2012
CMS Energy, including Consumers
Current income taxes
Federal		$	-		$	-		$	1
State and local			24			34			21
		$	24		$	34		$	22
Deferred income taxes
Federal		$	198		$	248		$	205
State and local			31			23			21
		$	229		$	271		$	226
Deferred income tax credit			(3)			(3)			(3)
Tax expense		$	250		$	302		$	245
Consumers
Current income taxes
Federal		$	8		$	137		$	110
State and local			36			45			37
		$	44		$	182		$	147
Deferred income taxes
Federal		$	236		$	147		$	134
State and local			29			20			19
		$	265		$	167		$	153
Deferred income tax credit			(3)			(3)			(3)
Tax expense		$	306		$	346		$	297

Principal Components Of Deferred Income Tax Assets Table



In Millions
December 31	2014			2013
CMS Energy, including Consumers
Employee benefits		$	(72)		$	(99)
Gas inventory			(117)			(130)
Plant, property, and equipment			(2,217)			(1,856)
Net regulatory tax liability			65			86
Reserves and accruals			63			57
Securitized costs			(144)			(190)
Tax loss and credit carryforwards			676			629
Other			-			15
		$	(1,746)		$	(1,488)
Less valuation allowance			(2)			(2)
Total net deferred income tax liabilities		$	(1,748)		$	(1,490)
Deferred tax assets, net of valuation reserves		$	802		$	785
Deferred tax liabilities			(2,550)			(2,275)
Total net deferred income tax liabilities		$	(1,748)		$	(1,490)
Consumers
Employee benefits		$	(103)		$	(119)
Gas inventory			(117)			(130)
Plant, property, and equipment			(2,263)			(1,911)
Net regulatory tax liability			65			86
Reserves and accruals			34			31
Securitized costs			(144)			(190)
Tax loss and credit carryforwards			45			48
Other			(2)			16
		$	(2,485)		$	(2,169)
Less valuation allowance			(1)			(1)
Total net deferred income tax liabilities		$	(2,486)		$	(2,170)
Deferred tax assets, net of valuation reserves		$	143		$	180
Deferred tax liabilities			(2,629)			(2,350)
Total net deferred income tax liabilities		$	(2,486)		$	(2,170)

Loss And Credit Carryforwards Table



In Millions
	Gross Amount			Tax Attribute			Expiration
CMS Energy, including Consumers
Federal net operating loss carryforward		$	1,032		$	362	2025 – 2034
Local net operating loss carryforwards			406			4	2023 – 2034
State capital loss carryforward			18			1	2014
Alternative minimum tax credits			270			270	No expiration
Charitable contribution carryover			1			1	2016 – 2019
General business credits			38			38	2018 – 2034
Total tax attributes					$	676
Consumers
Federal net operating loss carryforward		$	125		$	44	2025 – 2034
State capital loss carryforward			10			1	2014
Charitable contribution carryover			1			-	2016 – 2019
Total tax attributes					$	45

Reconciliation Of Beginning And Ending Uncertain Tax Benefits Table



In Millions
Years Ended December 31	2014			2013			2012
CMS Energy, including Consumers
Balance at beginning of period		$	4		$	1		$	4
Additions for current-year tax positions			2			-			-
Additions for prior-year tax positions			1			3			1
Reductions for prior-year tax positions			(2)			-			(4)
Balance at end of period		$	5		$	4		$	1
Consumers
Balance at beginning of period		$	4		$	1		$	4
Additions for current-year tax positions			2			-			-
Additions for prior-year tax positions			1			3			1
Reductions for prior-year tax positions			(2)			-			(4)
Balance at end of period		$	5		$	4		$	1

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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