Income Taxes

9 Months Ended

Sep. 30, 2023

Income Tax Disclosure [Abstract]

Income Taxes

6. INCOME TAXES

For continuing operations, including noncontrolling interests, the statutory U.S. federal income tax rate reconciles to DESC’s effective income tax rate as follows:

Nine Months Ended September 30,	2023			2022
U.S. statutory rate		21.0	%		21.0	%
Increases (reductions) resulting from:
State taxes, net of federal benefit		4.1			4.0
Reversal of excess deferred income taxes		(4.8	)		(4.5	)
Allowance for equity funds used during construction		—			(0.2	)
Settlements of uncertain tax positions		(2.7	)		—
Other, net		(0.2	)		(0.2	)
Effective tax rate		17.4	%		20.1	%

As of September 30, 2023, DESC’s effective tax rate reflects an income tax benefit of $11 million from the effective settlement of a position that management believed was reasonably possible to occur. Otherwise, there have been no material changes in DESC’s unrecognized tax benefits. See Note 7 to the Consolidated Financial Statements in DESC's Annual Report on Form 10-K for the year ended December 31, 2022 for a discussion of these unrecognized tax benefits.