16. Income Taxes and Other Taxes

Income Taxes. Duke Energy and its subsidiaries file income tax returns in the U.S. with federal and various state governmental authorities, and in certain foreign jurisdictions. The taxable income of Duke Energy and its subsidiaries is reflected in Duke Energy's U.S. federal and state income tax returns. These subsidiaries have a tax sharing agreement with Duke Energy where the separate return method is used to allocate tax expenses and benefits to the subsidiaries whose investments or results of operations provide these tax expenses and benefits. The accounting for income taxes essentially represents the income taxes that each of these subsidiaries would incur if it were a separate company filing its own tax return as a C-Corporation.

The effective tax rates for each of the Duke Energy Registrants are as follows:


	Three Months Ended March 31,
	2012			2011
Duke Energy		25.8	%		31.2	%
Duke Energy Carolinas		36.3	%		35.1	%
Duke Energy Ohio		37.0	%		36.8	%
Duke Energy Indiana		41.0	%		34.9	%

For the three months ended March 31, 2012, Duke Energy reflected a decrease in its effective tax rate as a result of a decrease in pre-tax income related to Edwardsport IGCC project impairment charges. In addition, Duke Energy Carolinas reflected an increase in its effective tax rate as a result of a decrease in AFUDC equity and Duke Energy Indiana reflected an increase in its effective tax rate due to a decrease in pre-tax income related to Edwardsport IGCC project impairment charges. See Note 4 for further details on the impairment charges.

Excise Taxes. Certain excise taxes levied by state or local governments are collected by the Duke Energy Registrants from its customers. These taxes, which are required to be paid regardless of the Duke Energy Registrants' ability to collect from the customer, are accounted for on a gross basis. When each of the Duke Energy Registrants act as an agent, and the tax is not required to be remitted if it is not collected from the customer, the taxes are accounted for on a net basis. Excise taxes for each Duke Energy Registrant accounted for on a gross basis and recorded as revenues and other tax expense in the respective Condensed Consolidated Statements of Operations were as follows:


	Three Months Ended March 31,
	2012		2011
	(in millions)
Duke Energy Carolinas	$	39	$	36
Duke Energy Ohio		30		34
Duke Energy Indiana		8		8

Duke Energy	$	77	$	78

Income Taxes And Other Taxes

16. Income Taxes and Other Taxes

Income Taxes. Duke Energy and its subsidiaries file income tax returns in the U.S. with federal and various state governmental authorities, and in certain foreign jurisdictions. The taxable income of Duke Energy and its subsidiaries is reflected in Duke Energy's U.S. federal and state income tax returns. These subsidiaries have a tax sharing agreement with Duke Energy where the separate return method is used to allocate tax expenses and benefits to the subsidiaries whose investments or results of operations provide these tax expenses and benefits. The accounting for income taxes essentially represents the income taxes that each of these subsidiaries would incur if it were a separate company filing its own tax return as a C-Corporation.

The effective tax rates for each of the Duke Energy Registrants are as follows:


	Three Months Ended March 31,
	2012			2011
Duke Energy		25.8	%		31.2	%
Duke Energy Carolinas		36.3	%		35.1	%
Duke Energy Ohio		37.0	%		36.8	%
Duke Energy Indiana		41.0	%		34.9	%

For the three months ended March 31, 2012, Duke Energy reflected a decrease in its effective tax rate as a result of a decrease in pre-tax income related to Edwardsport IGCC project impairment charges. In addition, Duke Energy Carolinas reflected an increase in its effective tax rate as a result of a decrease in AFUDC equity and Duke Energy Indiana reflected an increase in its effective tax rate due to a decrease in pre-tax income related to Edwardsport IGCC project impairment charges. See Note 4 for further details on the impairment charges.

Excise Taxes. Certain excise taxes levied by state or local governments are collected by the Duke Energy Registrants from its customers. These taxes, which are required to be paid regardless of the Duke Energy Registrants' ability to collect from the customer, are accounted for on a gross basis. When each of the Duke Energy Registrants act as an agent, and the tax is not required to be remitted if it is not collected from the customer, the taxes are accounted for on a net basis. Excise taxes for each Duke Energy Registrant accounted for on a gross basis and recorded as revenues and other tax expense in the respective Condensed Consolidated Statements of Operations were as follows:


	Three Months Ended March 31,
	2012		2011
	(in millions)
Duke Energy Carolinas	$	39	$	36
Duke Energy Ohio		30		34
Duke Energy Indiana		8		8

Duke Energy	$	77	$	78

Income Taxes And Other Taxes

16. Income Taxes and Other Taxes

Income Taxes. Duke Energy and its subsidiaries file income tax returns in the U.S. with federal and various state governmental authorities, and in certain foreign jurisdictions. The taxable income of Duke Energy and its subsidiaries is reflected in Duke Energy's U.S. federal and state income tax returns. These subsidiaries have a tax sharing agreement with Duke Energy where the separate return method is used to allocate tax expenses and benefits to the subsidiaries whose investments or results of operations provide these tax expenses and benefits. The accounting for income taxes essentially represents the income taxes that each of these subsidiaries would incur if it were a separate company filing its own tax return as a C-Corporation.

The effective tax rates for each of the Duke Energy Registrants are as follows:


	Three Months Ended March 31,
	2012			2011
Duke Energy		25.8	%		31.2	%
Duke Energy Carolinas		36.3	%		35.1	%
Duke Energy Ohio		37.0	%		36.8	%
Duke Energy Indiana		41.0	%		34.9	%

For the three months ended March 31, 2012, Duke Energy reflected a decrease in its effective tax rate as a result of a decrease in pre-tax income related to Edwardsport IGCC project impairment charges. In addition, Duke Energy Carolinas reflected an increase in its effective tax rate as a result of a decrease in AFUDC equity and Duke Energy Indiana reflected an increase in its effective tax rate due to a decrease in pre-tax income related to Edwardsport IGCC project impairment charges. See Note 4 for further details on the impairment charges.

Excise Taxes. Certain excise taxes levied by state or local governments are collected by the Duke Energy Registrants from its customers. These taxes, which are required to be paid regardless of the Duke Energy Registrants' ability to collect from the customer, are accounted for on a gross basis. When each of the Duke Energy Registrants act as an agent, and the tax is not required to be remitted if it is not collected from the customer, the taxes are accounted for on a net basis. Excise taxes for each Duke Energy Registrant accounted for on a gross basis and recorded as revenues and other tax expense in the respective Condensed Consolidated Statements of Operations were as follows:


	Three Months Ended March 31,
	2012		2011
	(in millions)
Duke Energy Carolinas	$	39	$	36
Duke Energy Ohio		30		34
Duke Energy Indiana		8		8

Duke Energy	$	77	$	78

Income Taxes And Other Taxes

16. Income Taxes and Other Taxes

Income Taxes. Duke Energy and its subsidiaries file income tax returns in the U.S. with federal and various state governmental authorities, and in certain foreign jurisdictions. The taxable income of Duke Energy and its subsidiaries is reflected in Duke Energy's U.S. federal and state income tax returns. These subsidiaries have a tax sharing agreement with Duke Energy where the separate return method is used to allocate tax expenses and benefits to the subsidiaries whose investments or results of operations provide these tax expenses and benefits. The accounting for income taxes essentially represents the income taxes that each of these subsidiaries would incur if it were a separate company filing its own tax return as a C-Corporation.

The effective tax rates for each of the Duke Energy Registrants are as follows:


	Three Months Ended March 31,
	2012			2011
Duke Energy		25.8	%		31.2	%
Duke Energy Carolinas		36.3	%		35.1	%
Duke Energy Ohio		37.0	%		36.8	%
Duke Energy Indiana		41.0	%		34.9	%

For the three months ended March 31, 2012, Duke Energy reflected a decrease in its effective tax rate as a result of a decrease in pre-tax income related to Edwardsport IGCC project impairment charges. In addition, Duke Energy Carolinas reflected an increase in its effective tax rate as a result of a decrease in AFUDC equity and Duke Energy Indiana reflected an increase in its effective tax rate due to a decrease in pre-tax income related to Edwardsport IGCC project impairment charges. See Note 4 for further details on the impairment charges.

Excise Taxes. Certain excise taxes levied by state or local governments are collected by the Duke Energy Registrants from its customers. These taxes, which are required to be paid regardless of the Duke Energy Registrants' ability to collect from the customer, are accounted for on a gross basis. When each of the Duke Energy Registrants act as an agent, and the tax is not required to be remitted if it is not collected from the customer, the taxes are accounted for on a net basis. Excise taxes for each Duke Energy Registrant accounted for on a gross basis and recorded as revenues and other tax expense in the respective Condensed Consolidated Statements of Operations were as follows:


	Three Months Ended March 31,
	2012		2011
	(in millions)
Duke Energy Carolinas	$	39	$	36
Duke Energy Ohio		30		34
Duke Energy Indiana		8		8

Duke Energy	$	77	$	78

Income Taxes And Other Taxes

16. Income Taxes and Other Taxes

Income Taxes. Duke Energy and its subsidiaries file income tax returns in the U.S. with federal and various state governmental authorities, and in certain foreign jurisdictions. The taxable income of Duke Energy and its subsidiaries is reflected in Duke Energy's U.S. federal and state income tax returns. These subsidiaries have a tax sharing agreement with Duke Energy where the separate return method is used to allocate tax expenses and benefits to the subsidiaries whose investments or results of operations provide these tax expenses and benefits. The accounting for income taxes essentially represents the income taxes that each of these subsidiaries would incur if it were a separate company filing its own tax return as a C-Corporation.

The effective tax rates for each of the Duke Energy Registrants are as follows:


	Three Months Ended March 31,
	2012			2011
Duke Energy		25.8	%		31.2	%
Duke Energy Carolinas		36.3	%		35.1	%
Duke Energy Ohio		37.0	%		36.8	%
Duke Energy Indiana		41.0	%		34.9	%

For the three months ended March 31, 2012, Duke Energy reflected a decrease in its effective tax rate as a result of a decrease in pre-tax income related to Edwardsport IGCC project impairment charges. In addition, Duke Energy Carolinas reflected an increase in its effective tax rate as a result of a decrease in AFUDC equity and Duke Energy Indiana reflected an increase in its effective tax rate due to a decrease in pre-tax income related to Edwardsport IGCC project impairment charges. See Note 4 for further details on the impairment charges.

Excise Taxes. Certain excise taxes levied by state or local governments are collected by the Duke Energy Registrants from its customers. These taxes, which are required to be paid regardless of the Duke Energy Registrants' ability to collect from the customer, are accounted for on a gross basis. When each of the Duke Energy Registrants act as an agent, and the tax is not required to be remitted if it is not collected from the customer, the taxes are accounted for on a net basis. Excise taxes for each Duke Energy Registrant accounted for on a gross basis and recorded as revenues and other tax expense in the respective Condensed Consolidated Statements of Operations were as follows:


	Three Months Ended March 31,
	2012		2011
	(in millions)
Duke Energy Carolinas	$	39	$	36
Duke Energy Ohio		30		34
Duke Energy Indiana		8		8

Duke Energy	$	77	$	78