Income Taxes

3 Months Ended

Mar. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

6. Income Taxes

Reconciliations of income tax expense (benefit) for the periods ended March 31 are as follows.

(PPL)
	Three Months
	2021		2020
Federal income tax on Income from Continuing Operations Before Income Taxes at statutory tax rate - 21%	$	55	$	56
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	12		13
Valuation allowance adjustments	8		6
Depreciation and other items not normalized	(2)		(2)
Amortization of excess deferred federal and state income taxes	(12)		(11)
Other	(2)		(1)
Total increase (decrease)	4		5
Total income tax expense (benefit)	$	59	$	61

(PPL Electric)
	Three Months
	2021		2020
Federal income tax on Income Before Income Taxes at statutory tax rate - 21%	$	32	$	33
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	12		13
Depreciation and other items not normalized	(2)		(2)
Amortization of excess deferred federal and state income taxes	(3)		(3)
Other	(2)		—
Total increase (decrease)	5		8
Total income tax expense (benefit)	$	37	$	41

(LKE)
	Three Months
	2021		2020
Federal income tax on Income Before Income Taxes at statutory tax rate - 21%	$	37	$	35
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	7		7
Valuation allowance adjustments	(4)		—
Amortization of excess deferred federal and state income taxes	(7)		(7)
Other	(3)		(1)
Total increase (decrease)	(7)		(1)
Total income tax expense (benefit)	$	30	$	34

(LG&E)
	Three Months
	2021		2020
Federal income tax on Income Before Income Taxes at statutory tax rate - 21%	$	20	$	19
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	4		4
Amortization of excess deferred federal and state income taxes	(3)		(3)
Other	(2)		(1)
Total increase (decrease)	(1)		—
Total income tax expense (benefit)	$	19	$	19

(KU)
	Three Months
	2021		2020
Federal income tax on Income Before Income Taxes at statutory tax rate - 21%	$	22	$	21
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	4		4
Amortization of excess deferred federal and state income taxes	(4)		(4)
Other	(1)		(1)
Total increase (decrease)	(1)		(1)
Total income tax expense (benefit)	$	21	$	20

Other

TCJA Regulatory Update (All Registrants)

In July 2020, the IRS issued final and new proposed regulations relating to the limitation on interest deductibility. The final regulations do not apply to the Registrants until the 2021 tax year. The new proposed regulations were finalized on January 5, 2021 and will apply to the Registrants in the 2022 tax year. The Registrants have evaluated the final regulations issued in 2021 and concluded that neither the 2020 or 2021 regulations should have a material impact on the Registrants’ financial condition or results of operations.