Highest deferred tax liability on their financials
Highest deferred tax liability on their financials
Dan, can you easily ascertain among the companies you cover who has the highest amount of deferred tax liability on their financials? I can do the work but if you can determine it easily that would save me some work. You stated in an earlier post that the new tax bill would benefit all of the Sweet 16. It seems to be they would all have deferred tax assets due to losses. Thanks.
Re: Highest deferred tax liability on their financials
Just go to the Q3 10-Q and it is set out on the balance sheet. The Elite Eight have the largest deferred tax liability. All upstream companies in the "Growth Phase" have big deferred tax liabilities because they get lots of IDC deductions.
For example, EOG Resources shows a $5.1 Billion of Deferred Income Taxes on their 9/30/2017 balance sheet. Trump's Tax Plan eliminates $1.5 to $2.0 Billion of that debt. It will be interesting to see how they run that adjustment through the financials at year-end.
Upstream companies pay a lot of taxes (sale and use tax, production taxes and property taxes), but they don't pay much income taxes.
I was over the Tax Department at Hess Corp. and Income Taxes were the lowest tax each year, but we had the IRS in our offices constantly. I was in Tax Court fighting the IRS for six straight years over the Windfall Profit Taxes. We kicked their ass in court. It was one of the "fun things" I got to do at Hess.
For example, EOG Resources shows a $5.1 Billion of Deferred Income Taxes on their 9/30/2017 balance sheet. Trump's Tax Plan eliminates $1.5 to $2.0 Billion of that debt. It will be interesting to see how they run that adjustment through the financials at year-end.
Upstream companies pay a lot of taxes (sale and use tax, production taxes and property taxes), but they don't pay much income taxes.
I was over the Tax Department at Hess Corp. and Income Taxes were the lowest tax each year, but we had the IRS in our offices constantly. I was in Tax Court fighting the IRS for six straight years over the Windfall Profit Taxes. We kicked their ass in court. It was one of the "fun things" I got to do at Hess.
Last edited by dan_s on Thu Dec 28, 2017 2:17 pm, edited 1 time in total.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Highest deferred tax liability on their financials
Thanks for the reply and interesting story! It prompted me to ask because several CEFs that hold MLPs were able to increase their NAV overnight (and the share price followed) due to the new tax law.