Eversource	For the Years Ended December 31,
(Millions of Dollars)	2015		2014		2013
Current Income Taxes:
Federal	$	6.2	$	4.4	$	8.8
State		45.7		24.5		(9.4)
Total Current		51.9		28.9		(0.6)
Deferred Income Taxes, Net:
Federal		436.1		406.8		386.2
State		55.6		36.5		45.4
Total Deferred		491.7		443.3		431.6
Investment Tax Credits, Net		(3.6)		(3.9)		(4.1)
Income Tax Expense	$	540.0	$	468.3	$	426.9

		For the Years Ended December 31,
		2015								2014								2013
				NSTAR								NSTAR								NSTAR
(Millions of Dollars)		CL&P		Electric		PSNH		WMECO		CL&P		Electric		PSNH		WMECO		CL&P		Electric		PSNH		WMECO
Current Income Taxes:
	Federal	$	26.9	$	36.3	$	(16.7)	$	(3.5)	$	(0.2)	$	75.0	$	(22.6)	$	1.9	$	20.1	$	95.8	$	(8.2)	$	(53.4)
	State		15.8		19.8		6.0		1.6		4.3		20.2		(0.1)		1.8		(6.7)		29.6		3.6		4.2
Total Current			42.7		56.1		(10.7)		(1.9)		4.1		95.2		(22.7)		3.7		13.4		125.4		(4.6)		(49.2)
Deferred Income Taxes, Net:
	Federal		135.8		147.5		74.5		33.4		138.0		88.0		79.6		28.1		114.9		49.8		64.5		84.7
	State		0.2		25.7		9.3		6.0		(7.1)		20.1		15.2		6.0		15.1		(1.0)		11.2		2.3
Total Deferred			136.0		173.2		83.8		39.4		130.9		108.1		94.8		34.1		130.0		48.8		75.7		87.0
Investment Tax Credits, Net			(1.3)		(1.3)		-		(0.5)		(1.5)		(1.3)		-		(0.5)		(1.7)		(1.3)		-		(0.4)
Income Tax Expense		$	177.4	$	228.0	$	73.1	$	37.0	$	133.5	$	202.0	$	72.1	$	37.3	$	141.7	$	172.9	$	71.1	$	37.4

A reconciliation between income tax expense and the expected tax expense at the statutory rate is as follows:

Eversource		For the Years Ended December 31,
(Millions of Dollars, except percentages)		2015		2014		2013
Income Before Income Tax Expense		$	1,425.9	$	1,295.4	$	1,220.6

Statutory Federal Income Tax Expense at 35%			499.1		453.4		427.2
Tax Effect of Differences:
	Depreciation		(4.6)		(5.6)		(7.4)
	Investment Tax Credit Amortization		(3.6)		(3.9)		(4.1)
	Other Federal Tax Credits		(3.8)		(3.5)		(3.7)
	State Income Taxes, Net of Federal Impact		61.1		42.5		27.6
	Dividends on ESOP		(8.1)		(8.0)		(8.0)
	Tax Asset Valuation Allowance/Reserve Adjustments		4.7		(2.9)		(4.3)
	Other, Net		(4.8)		(3.7)		(0.4)
Income Tax Expense		$	540.0	$	468.3	$	426.9
Effective Tax Rate			37.9%		36.2%		35.0%

		For the Years Ended December 31,
		2015								2014								2013
(Millions of Dollars,				NSTAR								NSTAR								NSTAR
	except percentages)	CL&P		Electric		PSNH		WMECO		CL&P		Electric		PSNH		WMECO		CL&P		Electric		PSNH		WMECO
Income Before Income Tax Expense		$	476.8	$	572.6	$	187.5	$	93.5	$	421.2	$	505.1	$	186.1	$	95.1	$	421.1	$	441.4	$	182.5	$	97.8

Statutory Federal Income Tax Expense at 35%			166.9		200.4		65.6		32.7		147.4		176.8		65.1		33.3		147.4		154.5		63.9		34.2
Tax Effect of Differences:
	Depreciation		(1.7)		(1.4)		0.5		(0.3)		(3.6)		(1.3)		0.3		(0.2)		(7.0)		0.1		0.6		-
	Investment Tax Credit Amortization		(1.3)		(1.3)		-		(0.5)		(1.5)		(1.3)		-		(0.5)		(1.7)		(1.3)		-		(0.4)
	Other Federal Tax Credits		-		-		(3.8)		-		-		-		(3.5)		-		-		-		(3.7)		-
	State Income Taxes, Net of Federal Impact		9.2		29.6		9.9		4.9		4.4		26.2		9.8		5.0		5.0		18.6		9.6		4.2
	Tax Asset Valuation Allowance/ Reserve Adjustments		1.2		-		-		-		(6.3)		-		-		-		0.4		-		-		-
	Other, Net		3.1		0.7		0.9		0.2		(6.9)		1.6		0.4		(0.3)		(2.4)		1.0		0.7		(0.6)
Income Tax Expense		$	177.4	$	228.0	$	73.1	$	37.0	$	133.5	$	202.0	$	72.1	$	37.3	$	141.7	$	172.9	$	71.1	$	37.4
Effective Tax Rate			37.2%		39.8%		39.0%		39.6%		31.7%		40.0%		38.7%		39.2%		33.6%		39.2%		39.0%		38.2%

Eversource, CL&P, NSTAR Electric, PSNH and WMECO file a consolidated federal income tax return and unitary, combined and separate state income tax returns. These entities are also parties to a tax allocation agreement under which taxable subsidiaries do not pay any more taxes than they would have otherwise paid had they filed a separate company tax return, and subsidiaries generating tax losses, if any, are paid for their losses when utilized.

Deferred tax assets and liabilities are recognized for the future tax effects of temporary differences between the carrying amounts and the tax basis of assets and liabilities. The tax effect of temporary differences is accounted for in accordance with the rate-making treatment of the applicable regulatory commissions and relevant accounting authoritative literature. The tax effects of temporary differences that give rise to the net accumulated deferred income tax obligations are as follows:

Eversource			As of December 31,
(Millions of Dollars)			2015		2014
Deferred Tax Assets:
	Employee Benefits		$	637.5	$	632.2
	Derivative Liabilities			172.7		199.6
	Regulatory Deferrals - Liabilities			243.5		366.7
	Allowance for Uncollectible Accounts			60.5		60.5
	Tax Effect - Tax Regulatory Liabilities			9.7		10.0
	Federal Net Operating Loss Carryforwards			5.4		59.1
	Purchase Accounting Adjustment			119.3		126.2
	Other			197.1		198.7
Total Deferred Tax Assets				1,445.7		1,653.0
	Less: Valuation Allowance			3.7		5.1
Net Deferred Tax Assets			$	1,442.0	$	1,647.9
Deferred Tax Liabilities:
	Accelerated Depreciation and Other Plant-Related Differences		$	4,602.6	$	4,215.9
	Property Tax Accruals			76.7		109.6
	Regulatory Amounts:
		Regulatory Deferrals - Assets		1,289.1		1,277.9
		Tax Effect - Tax Regulatory Assets		249.3		240.2
		Goodwill Regulatory Asset - 1999 Merger		194.9		203.2
		Derivative Assets		17.7		32.6
		Other		159.4		196.3
Total Deferred Tax Liabilities			$	6,589.7	$	6,275.7

			As of December 31,
			2015								2014
					NSTAR								NSTAR
(Millions of Dollars)			CL&P		Electric		PSNH		WMECO		CL&P		Electric		PSNH		WMECO
Deferred Tax Assets:
	Employee Benefits		$	126.1	$	91.3	$	37.1	$	10.0	$	129.0	$	39.9	$	46.8	$	9.2
	Derivative Liabilities			165.7		0.6		-		-		193.0		1.8		-		-
	Regulatory Deferrals - Liabilities			36.0		109.4		42.1		6.1		73.9		181.3		46.5		11.4
	Allowance for Uncollectible Accounts			30.4		8.5		3.6		4.5		32.3		13.8		3.2		3.8
	Tax Effect - Tax Regulatory Liabilities			3.1		1.5		2.3		2.4		3.1		1.8		2.1		2.5
	Federal Net Operating Loss Carryforwards			-		-		2.4		0.4		-		-		32.1		4.5
	Other			55.5		3.4		61.1		5.0		53.8		19.9		48.9		4.9
Total Deferred Tax Assets				416.8		214.7		148.6		28.4		485.1		258.5		179.6		36.3
	Less: Valuation Allowance			3.1		-		-		-		4.0		-		-		-
Net Deferred Tax Assets			$	413.7	$	214.7	$	148.6	$	28.4	$	481.1	$	258.5	$	179.6	$	36.3
Deferred Tax Liabilities:
	Accelerated Depreciation and Other Plant-Related Differences		$	1,545.6	$	1,387.1	$	655.3	$	416.1	$	1,378.6	$	1,296.9	$	596.6	$	385.8
	Property Tax Accruals			27.3		22.8		7.3		10.6		58.1		25.0		7.4		12.8
	Regulatory Amounts:
		Regulatory Deferrals - Assets		456.8		339.7		137.9		60.5		502.3		276.0		147.6		60.4
		Tax Effect - Tax Regulatory Assets		168.7		36.0		15.4		9.0		166.9		35.5		15.9		9.3
		Goodwill Regulatory Asset - 1999 Merger		-		167.4		-		-		-		174.4		-		-
		Derivative Assets		17.7		-		-		-		32.6		-		-		-
		Other		18.5		22.0		38.6		2.7		19.4		33.5		35.6		2.8
Total Deferred Tax Liabilities			$	2,234.6	$	1,975.0	$	854.5	$	498.9	$	2,157.9	$	1,841.3	$	803.1	$	471.1

Carryforwards: The following tables provide the amounts and expiration dates of state tax credit and loss carryforwards and federal tax credit and net operating loss carryforwards:

	As of December 31, 2015
					NSTAR
(Millions of Dollars)	Eversource		CL&P		Electric		PSNH		WMECO		Expiration Range
Federal Net Operating Loss	$	15.5	$	-	$	-	$	7.0	$	1.0	2032
Federal Tax Credit		26.1		0.1		0.2		15.0		-	2031 - 2035
Federal Charitable Contribution		14.9		-		-		-		-	2016 - 2018
State Tax Credit		101.2		73.8		-		-		-	2015 - 2020
State Charitable Contribution		3.0		-		-		-		-	2015 - 2019

	As of December 31, 2014
					NSTAR
(Millions of Dollars)	Eversource		CL&P		Electric		PSNH		WMECO		Expiration Range
Federal Net Operating Loss	$	168.8	$	-	$	-	$	91.8	$	12.7	2031 - 2032
Federal Tax Credit		16.3		0.1		0.2		11.1		-	2031 - 2034
Federal Charitable Contribution		19.4		-		-		-		-	2016 - 2018
State Tax Credit		99.7		71.0		-		-		-	2014 - 2019
State Loss Carryforwards		40.6		-		-		-		-	2014 - 2034
State Charitable Contribution		2.1		-		-		-		-	2015 - 2018

In 2015, the Company decreased its valuation allowance reserve for state credits and state loss carryforwards by $1.3 million (CL&P $0.9 million), net of tax, to reflect an update for expired state tax credits and loss carryforwards.

In 2014, the Company recorded a reduction to its state credit carryforwards of $11 million (CL&P $10.1 million), net of tax, as a result of an update to reflect the amounts expired. Further, the Company decreased its valuation allowance reserve for state credits by $19.2 million at CL&P, net of tax, to reflect an update for expired state credits and latest estimate of usage.

For 2015 and 2014, state credit and state loss carryforwards have been partially reserved by a valuation allowance of $3.1 million and $4.4 million (net of tax), respectively.

Unrecognized Tax Benefits: A reconciliation of the activity in unrecognized tax benefits, all of which would impact the effective tax rate if recognized, is as follows:

(Millions of Dollars)		Eversource		CL&P
Balance as of January 1, 2013		$	83.1	$	49.0
	Gross Increases - Current Year		8.2		2.1
	Gross Decreases - Prior Year		(1.1)		(0.3)
	Settlements		(49.8)		(39.4)
	Lapse of Statute of Limitations		(2.2)		-
Balance as of December 31, 2013			38.2		11.4
	Gross Increases - Current Year		9.3		2.7
	Gross Increases - Prior Year		0.3		0.2
	Lapse of Statute of Limitations		(1.6)		-
Balance as of December 31, 2014			46.2		14.3
	Gross Increases - Current Year		9.9		2.6
	Gross Increases - Prior Year		0.1		-
	Lapse of Statute of Limitations		(8.2)		(3.4)
Balance as of December 31, 2015		$	48.0	$	13.5

Interest and Penalties: Interest on uncertain tax positions is recorded and generally classified as a component of Other Interest Expense on the statements of income. However, when resolution of uncertainties results in the Company receiving interest income, any related interest benefit is recorded in Other Income, Net on the statements of income. No penalties have been recorded. The amount of interest expense/(income) on uncertain tax positions recognized and the related accrued interest payable/(receivable) are as follows:

Tax Positions: During 2015 and 2014, Eversource did not resolve any of its uncertain tax positions.

Open Tax Years: The following table summarizes Eversource, CL&P, NSTAR Electric, PSNH and WMECO's tax years that remain subject to examination by major tax jurisdictions as of December 31, 2015:

Eversource estimates that during the next twelve months, differences of a non-timing nature could be resolved, resulting in a zero to $2.3 million decrease in unrecognized tax benefits by Eversource. These estimated changes are not expected to have a material impact on the earnings of Eversource. Other companies' impacts are not expected to be material.

2015 Federal Legislation: On December 18, 2015, the "Protecting Americans from Tax Hikes" Act became law, which extended the accelerated deduction of depreciation to businesses from 2015 through 2019. This extended stimulus provides Eversource with cash flow benefits in 2016 of approximately $275 million (including approximately $105 million for CL&P, $72 million for NSTAR Electric, $46 million for PSNH, and $25 million for WMECO) due to a refund of taxes paid in 2015 and lower expected tax payments in 2016 of approximately $300 million.

2015 Connecticut Legislation: In 2015, the state of Connecticut enacted several changes to its corporate tax laws. Among the changes, commencing as of January 1, 2015, is the reduction in the amount of tax credits that corporations can utilize against its tax liability in a year and a continuation of the corporate income tax surcharge through 2018, which effectively increases the state corporate tax rate to 9 percent for the years 2016 and 2017 and 8.25 percent for 2018. Also, effective January 1, 2016, all Connecticut companies have a mandatory unitary tax filing requirement. Management continues to review the tax law changes and their impact on the effective tax rates of Eversource and CL&P.

2014 Federal Legislation: On December 19, 2014, the "Tax Increase Prevention Act of 2014" became law, which extended the accelerated deduction of depreciation to businesses through 2014. This extended stimulus provided Eversource with cash flow benefits of approximately $250 million (approximately $86 million at CL&P, $64 million at NSTAR Electric, $44 million at PSNH, and $21 million at WMECO) in 2015.