Income Taxes Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Schedule of Income before Income Tax, Domestic and Foreign

The jurisdictional components of income from continuing operations before income tax expense (benefit), attributable to Calpine, for the years ended December 31, 2019, 2018 and 2017, are as follows (in millions):



	2019		2018		2017
U.S.	$	836	$	47	$	(358	)
International	32		27		27
Total	$	868	$	74	$	(331	)

Schedule of Components of Income Tax Expense (Benefit)

The components of income tax expense from continuing operations for the years ended December 31, 2019, 2018 and 2017, consisted of the following (in millions):



	2019			2018			2017
Current:
Federal	$	(2	)	$	—		$	(10	)
State	2			20			18
Foreign	3			(3		)	(14		)
Total current	3			17			(6		)
Deferred:
Federal	66			(1		)	5
State	28			(6		)	6
Foreign	1			54			3
Total deferred	95			47			14
Total income tax expense	$	98		$	64		$	8

Schedule of Effective Income Tax Rate Reconciliation

A reconciliation of the federal statutory rate of 21% and, prior to 2018, 35% to our effective rate from continuing operations for the years ended December 31, 2019, 2018 and 2017, is as follows:



	2019		2018		2017
Federal statutory tax rate	21.0	%	21.0	%	35.0	%
State tax expense, net of federal benefit	2.8		17.0		(6.0	)
Change in tax rate of net deferred tax asset	—		—		(168.8	)
Valuation allowances offsetting tax rate change	—		—		168.8
Valuation allowances against future tax benefits	(11.2	)	(31.7	)	(33.0	)
Valuation allowance related to foreign taxes	—		(138.3	)	0.5
Decrease in foreign NOL due to change in ownership	—		202.3		—
Distributions from foreign affiliates and foreign taxes	0.2		6.6		(2.0	)
Change in unrecognized tax benefits	—		(8.0	)	5.1
Disallowed compensation	—		7.7		(0.6	)
Stock-based compensation	—		(1.5	)	(0.9	)
Equity earnings	0.1		1.4		(0.8	)
Merger Related Fees/Expenses	—		12.7		—
Depletion in excess of basis	(0.3	)	(4.0	)	—
Other differences	(1.3	)	1.3		0.3
Effective income tax rate	11.3	%	86.5	%	(2.4	)%

Schedule of Deferred Tax Assets and Liabilities

The components of deferred income taxes as of December 31, 2019 and 2018, are as follows (in millions):



	2019			2018
Deferred tax assets:
NOL and credit carryforwards	$	1,731		$	1,595
Taxes related to risk management activities and derivatives	18			7
Reorganization items and impairments	73			166
Other differences	62			101
Deferred tax assets before valuation allowance	1,884			1,869
Valuation allowance	(873		)	(1,000		)
Total deferred tax assets	1,011			869
Deferred tax liabilities:
Property, plant and equipment	(1,125		)	(890		)
Total deferred tax liabilities	(1,125		)	(890		)
Net deferred tax asset (liability)	(114		)	(21		)
Less: Non-current deferred tax liability	(116		)	(22		)
Deferred income tax asset, non-current	$	2		$	1

Schedule of Income Tax Contingencies

A reconciliation of the beginning and ending amounts of our unrecognized tax benefits for the years ended December 31, 2019, 2018 and 2017, is as follows (in millions):



	2019			2018			2017
Balance, beginning of period	$	(28	)	$	(38	)	$	(59	)
Increases related to prior year tax positions	—			(7		)	—
Decreases related to prior year tax positions	—			17			11
Increases related to current year tax positions	(1		)	—			(2		)
Decreases related to change in tax rate of net deferred tax asset	—			—			12
Balance, end of period	$	(29	)	$	(28	)	$	(38	)