Enterprise Products Partners L.P.

SEC Filings

10-K
ENTERPRISE PRODUCTS PARTNERS L P filed this Form 10-K on 02/28/2018
Entire Document
 

ENTERPRISE PRODUCTS PARTNERS L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
A reconciliation of the provision for (benefit from) income taxes with amounts determined by applying the statutory U.S. federal income tax rate to income before income taxes is as follows:

 
 
For the Year Ended December 31,
 
 
 
2017
   
2016
   
2015
 
Pre-Tax Net Book Income (“NBI”)
 
$
2,881.3
   
$
2,576.4
   
$
2,555.9
 
 
                       
Texas Margin Tax (1)
 
$
26.4
   
$
22.1
   
$
(3.7
)
State income taxes (net of federal benefit)
   
0.5
     
0.2
     
0.7
 
Federal income taxes computed by applying the federal 
statutory rate to NBI of corporate entities
   
0.1
     
0.8
     
1.1
 
Other permanent differences
   
(1.3
)
   
0.3
     
(0.6
)
Provision for (benefit from) income taxes
 
$
25.7
   
$
23.4
   
$
(2.5
)
 
                       
Effective income tax rate
   
0.9%
 
   
0.9%
 
   
(0.1)%
 
   
(1)   Although the Texas Margin Tax is not considered a state income tax, it has the characteristics of an income tax since it is determined by applying a tax rate to a base that considers our Texas-sourced revenues and expenses. During 2015, certain legislative changes were enacted to the Texas Margin Tax, which reduced the tax rate for business entities that operate within the state.
 

The following table presents the significant components of deferred tax assets and deferred tax liabilities at the dates indicated:

 
 
December 31,
 
 
 
2017
   
2016
 
Deferred tax assets:
           
Net operating loss carryovers (1)
 
$
0.2
   
$
0.2
 
Accruals
   
1.4
     
1.6
 
Total deferred tax assets
   
1.6
     
1.8
 
Less:  Deferred tax liabilities:
               
Property, plant and equipment
   
58.0
     
50.5
 
Equity investment in partnerships
   
2.1
     
3.7
 
Total deferred tax liabilities
   
60.1
     
54.2
 
Total net deferred tax liabilities
 
$
58.5
   
$
52.4
 
   
(1)   These losses expire in various years between 2018 and 2033 and are subject to limitations on their utilization.
 

Accounting guidance provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits.  We did not rely on any uncertain tax positions in recording our income tax-related amounts during the years ended December 31, 2017, 2016 or 2015.


Note 17.  Commitments and Contingencies

Litigation
As part of our normal business activities, we may be named as defendants in legal proceedings, including those arising from regulatory and environmental matters.  Although we are insured against various risks to the extent we believe it is prudent, there is no assurance that the nature and amount of such insurance will be adequate, in every case, to fully indemnify us against losses arising from future legal proceedings.  We will vigorously defend the partnership in litigation matters.

Management has regular quarterly litigation reviews, including updates from legal counsel, to assess the possible need for accounting recognition and disclosure of these contingencies.  We accrue an undiscounted liability for those contingencies where the loss is probable and the amount can be reasonably estimated.  If a range of probable loss amounts can be reasonably estimated and no amount within the range is a better estimate than any other amount, then the minimum amount in the range is accrued.
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