Income Taxes (Tables)

12 Months Ended

Dec. 31, 2015

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2015			2014		2013
	(in millions)
Federal —
Current	$	(177	)	$	175	$	363
Deferred	1,266			695		386
	1,089			870		749
State —
Current	(33		)	93		(10		)
Deferred	138			14		110
	105			107		100
Total	$	1,194		$	977	$	849

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2015			2014
	(in millions)
Deferred tax liabilities —
Accelerated depreciation	$	12,767		$	11,125
Property basis differences	1,543			1,332
Leveraged lease basis differences	308			299
Employee benefit obligations	579			613
Premium on reacquired debt	95			103
Regulatory assets associated with employee benefit obligations	1,378			1,390
Regulatory assets associated with AROs	1,422			871
Other	586			523
Total	18,678			16,256
Deferred tax assets —
Federal effect of state deferred taxes	479			430
Employee benefit obligations	1,720			1,675
Over recovered fuel clause	104			—
Other property basis differences	695			453
Deferred costs	83			86
ITC carryforward	742			480
Unbilled revenue	111			67
Other comprehensive losses	85			89
AROs	1,422			871
Estimated Loss on Kemper IGCC	451			631
Deferred state tax assets	220			117
Other	246			342
Total	6,358			5,241
Valuation allowance	(2		)	(49		)
Total deferred tax assets	6,356			5,192
Accumulated deferred income taxes	$	12,322		$	11,064

Reconciliation of federal statutory income tax rate to effective income tax rate

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2015		2014		2013
Federal statutory rate	35.0	%	35.0	%	35.0	%
State income tax, net of federal deduction	1.9		2.3		2.5
Employee stock plans dividend deduction	(1.2	)	(1.4	)	(1.6	)
Non-deductible book depreciation	1.2		1.4		1.5
AFUDC-Equity	(2.2	)	(2.9	)	(2.6	)
ITC basis difference	(1.5	)	(1.6	)	(1.2	)
Other	(0.3	)	(0.3	)	(0.5	)
Effective income tax rate	32.9	%	32.5	%	33.1	%

Changes in unrecognized tax benefits

Changes during the year in unrecognized tax benefits were as follows:

	2015			2014			2013
	(in millions)
Unrecognized tax benefits at beginning of year	$	170		$	7		$	70
Tax positions increase from current periods	43			64			3
Tax positions increase from prior periods	240			102			—
Tax positions decrease from prior periods	(20		)	(3		)	(66		)
Balance at end of year	$	433		$	170		$	7

Impact on effective tax rate

The impact on Southern Company's effective tax rate, if recognized, is as follows:

	2015		2014		2013
	(in millions)
Tax positions impacting the effective tax rate	$	10	$	10	$	7
Tax positions not impacting the effective tax rate	423		160		—
Balance of unrecognized tax benefits	$	433	$	170	$	7

Alabama Power [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2015		2014		2013
	(in millions)
Federal —
Current	$	110	$	198	$	243
Deferred	320		225		160
	430		423		403
State —
Current	8		44		36
Deferred	68		45		39
	76		89		75
Total	$	506	$	512	$	478

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2015		2014
	(in millions)
Deferred tax liabilities —
Accelerated depreciation	$	3,917	$	3,429
Property basis differences	456		457
Premium on reacquired debt	28		30
Employee benefit obligations	200		215
Regulatory assets associated with employee benefit obligations	375		366
Asset retirement obligations	289		59
Regulatory assets associated with asset retirement obligations	312		285
Other	175		157
Total	5,752		4,998
Deferred tax assets —
Federal effect of state deferred taxes	242		219
Unbilled fuel revenue	39		42
Storm reserve	23		27
Employee benefit obligations	407		400
Other comprehensive losses	20		19
Asset retirement obligations	600		344
Other	180		90
Total	1,511		1,141
Accumulated deferred income taxes, net	$	4,241	$	3,857

Reconciliation of federal statutory income tax rate to effective income tax rate

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2015	2014	2013
Federal statutory rate	35.0%	35.0%	35.0%
State income tax, net of federal deduction	3.8	4.4	4.0
Non-deductible book depreciation	1.2	1.1	1.0
Differences in prior years' deferred and current tax rates	(0.1)	(0.1)	(0.1)
AFUDC equity	(1.6)	(1.3)	(0.9)
Other	0.1	(0.1)	(0.1)
Effective income tax rate	38.4%	39.0%	38.9%

Georgia Power [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2015			2014			2013
	(in millions)
Federal –
Current	$	515		$	295		$	277
Deferred	176			366			374
	691			661			651
State –
Current	81			82			(30		)
Deferred	(3		)	(14		)	102
	78			68			72
Total	$	769		$	729		$	723

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2015		2014
	(in millions)
Deferred tax liabilities –
Accelerated depreciation	$	4,909	$	4,732
Property basis differences	943		811
Employee benefit obligations	310		329
Under-recovered fuel costs	—		81
Premium on reacquired debt	61		66
Regulatory assets associated with employee benefit obligations	528		534
Asset retirement obligations	706		497
Other	187		160
Total	7,644		7,210
Deferred tax assets –
Federal effect of state deferred taxes	150		148
Employee benefit obligations	642		642
Other property basis differences	88		86
Other deferred costs	83		86
Cost of removal obligations	6		11
State investment tax credit carryforward	188		152
Federal tax credit carryforward	3		5
Over-recovered fuel costs	45		—
Unbilled fuel revenue	47		46
Asset retirement obligations	706		497
Other	59		63
Total	2,017		1,736
Accumulated deferred income taxes	$	5,627	$	5,474

Reconciliation of federal statutory income tax rate to effective income tax rate

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2015	2014	2013
Federal statutory rate	35.0%	35.0%	35.0%
State income tax, net of federal deduction	2.5	2.2	2.5
Non-deductible book depreciation	1.2	1.3	1.3
AFUDC equity	(0.7)	(0.8)	(0.6)
Other	(0.4)	(0.7)	(0.4)
Effective income tax rate	37.6%	37.0%	37.8%

Changes in unrecognized tax benefits

Changes in unrecognized tax benefits were as follows:

	2015		2014		2013
	(in millions)
Unrecognized tax benefits at beginning of year	$	—	$	—	$	23
Tax positions increase from prior periods	3		—		—
Tax positions decrease from prior periods	—		—		(23		)
Balance at end of year	$	3	$	—	$	—

Gulf Power [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2015			2014		2013
	(in millions)
Federal -
Current	$	(3	)	$	23	$	5
Deferred	80			52		63
	77			75		68
State -
Current	5			—		(2		)
Deferred	10			13		14
	15			13		12
Total	$	92		$	88	$	80

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2015		2014
	(in millions)
Deferred tax liabilities-
Accelerated depreciation	$	812	$	777
Property basis differences	133		52
Fuel recovery clause	—		16
Pension and other employee benefits	39		34
Regulatory assets associated with employee benefit obligations	59		60
Regulatory assets associated with asset retirement obligations	40		7
Other	26		22
Total	1,109		968
Deferred tax assets-
Federal effect of state deferred taxes	33		31
Postretirement benefits	26		18
Pension and other employee benefits	65		66
Property reserve	15		13
Asset retirement obligations	40		7
Alternative minimum tax carryforward	18		18
Other	19		18
Total	216		171
Accumulated deferred income taxes	$	893	$	797

Reconciliation of federal statutory income tax rate to effective income tax rate

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2015	2014	2013
Federal statutory rate	35.0%	35.0%	35.0%
State income tax, net of federal deduction	3.9	3.5	3.5
Non-deductible book depreciation	0.5	0.4	0.5
Differences in prior years' deferred and current tax rates	(0.1)	(0.1)	(0.2)
AFUDC equity	(1.8)	(1.8)	(1.1)
Other, net	(0.6)	0.1	(0.1)
Effective income tax rate	36.9%	37.1%	37.6%

Mississippi Power [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2015			2014			2013
	(in millions)
Federal —
Current	$	(768	)	$	(431	)	$	23
Deferred	704			183			(343		)
	(64		)	(248		)	(320		)
State —
Current	(81		)	1			5
Deferred	73			(38		)	(53		)
	(8		)	(37		)	(48		)
Total	$	(72	)	$	(285	)	$	(368	)

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2015		2014
	(in millions)
Deferred tax liabilities —
Accelerated depreciation	$	1,618	$	1,068
ECM under recovered	13		—
Regulatory assets associated with AROs	71		19
Pensions and other benefits	30		35
Regulatory assets associated with employee benefit obligations	66		68
Regulatory assets associated with the Kemper IGCC	86		62
Rate differential	115		89
Federal effect of state deferred taxes	—		1
Fuel clause under recovered	—		3
Other	163		52
Total	2,162		1,397
Deferred tax assets —
Fuel clause over recovered	51		—
Estimated loss on Kemper IGCC	451		631
Pension and other benefits	92		92
Property insurance	25		24
Premium on long-term debt	18		21
Unbilled fuel	16		15
AROs	71		19
Interest rate hedges	4		5
Kemper rate factor - regulatory liability retail	—		108
Property basis difference	451		263
ECM over recovered	—		1
Deferred state tax assets	152		57
Deferred federal tax assets	48		—
Federal effect of state deferred taxes	8		—
Other	13		15
Total	1,400		1,251
Total deferred tax liabilities, net	762		146
Deferred state tax asset	—		34
Accumulated deferred income taxes	$	762	$	180

Reconciliation of federal statutory income tax rate to effective income tax rate

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2015		2014		2013
Federal statutory rate	(35.0	)%	(35.0	)%	(35.0	)%
State income tax, net of federal deduction	(6.3	)	(4.0	)	(3.7	)
Non-deductible book depreciation	1.3		0.1		0.1
AFUDC-equity	(49.6	)	(7.8	)	(5.0	)
Other	(2.9	)	0.1		(0.1	)
Effective income tax rate (benefit rate)	(92.5	)%	(46.6	)%	(43.7	)%

Changes in unrecognized tax benefits

Changes during the year in unrecognized tax benefits were as follows:

	2015		2014		2013
	(in millions)
Unrecognized tax benefits at beginning of year	$	165	$	4	$	6
Tax positions increase from current periods	32		58		—
Tax positions increase/(decrease) from prior periods	224		103		(2		)
Balance at end of year	$	421	$	165	$	4

Impact on effective tax rate

The impact on the Company's effective tax rate, if recognized, is as follows:

	2015			2014		2013
	(in millions)
Tax positions impacting the effective tax rate	$	(2	)	$	4	$	4
Tax positions not impacting the effective tax rate	423			161		—
Balance of unrecognized tax benefits	$	421		$	165	$	4

Accrued interest for unrecognized tax benefits

Accrued interest for unrecognized tax benefits was as follows:

	2015		2014		2013
	(in millions)
Interest accrued at beginning of year	$	3	$	1	$	1
Interest accrued during the year	6		2		—
Balance at end of year	$	9	$	3	$	1

Southern Power [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2015			2014			2013
	(in millions)
Federal —
Current(*)	$	12		$	179		$	(120	)
Deferred(*)	10			(166		)	159
	22			13			39
State —
Current	(32		)	(14		)	(5		)
Deferred	31			(2		)	12
	(1		)	(16		)	7
Total	$	21		$	(3	)	$	46

(*) ITCs generated in the current tax year and carried forward from prior tax years that cannot be utilized in the current tax year are reclassified from current to deferred taxes in the federal income tax expense above. ITCs reclassified in this manner include $246 million for 2015 and $305 million for 2014. These ITCs are included in the following table of temporary differences as unrealized tax credits.

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2015			2014
	(in millions)
Deferred tax liabilities —
Accelerated depreciation and other property basis differences	$	1,364		$	1,006
Basis difference on asset transfers	3			3
Levelized capacity revenues	22			17
Other	4			6
Total	1,393			1,032
Deferred tax assets —
Federal effect of state deferred taxes	40			29
Net basis difference on federal ITCs	149			102
Alternative minimum tax carryforward	15			15
Unrealized tax credits	551			305
Unrealized loss on interest rate swaps	4			6
Levelized capacity revenues	4			5
Deferred state tax assets	13			15
Other	18			4
Total	794			481
Valuation Allowance	(2		)	(8		)
Net deferred income tax assets	792			473
Accumulated deferred income taxes	$	601		$	559

Reconciliation of federal statutory income tax rate to effective income tax rate

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2015		2014		2013
Federal statutory rate	35.0	%	35.0	%	35.0	%
State income tax, net of federal deduction	(0.3	)	(6.0	)	2.2
Amortization of ITC	(5.0	)	(4.3	)	(1.7	)
ITC basis difference	(21.5	)	(27.7	)	(14.5	)
Other	0.2		1.1		0.3
Effective income tax rate	8.4	%	(1.9	)%	21.3	%

Changes in unrecognized tax benefits

Changes during the year in unrecognized tax benefits were as follows:

	2015			2014			2013
	(in millions)
Unrecognized tax benefits at beginning of year	$	5		$	2		$	3
Tax positions increase from current periods	9			5			2
Tax positions decrease from prior periods	(6		)	(2		)	(3		)
Balance at end of year	$	8		$	5		$	2