Income Taxes
The (provision) benefit for income taxes for the years ended December 31, 2017, 2016, and 2015 consisted of the following (in millions):
|
| | | | | | | | | | | | | | | | | | | | | | | |
| CEQP | | CMLP |
| Year Ended December 31, | | Year Ended December 31, |
| 2017 | | 2016 | | 2015 | | 2017 (1) | | 2016 | | 2015 |
Current: | | | | | | | | | | | |
Federal | $ | (1.1 | ) | | $ | (3.2 | ) | | $ | (1.6 | ) | | $ | — |
| | $ | — |
| | $ | — |
|
State | (0.2 | ) | | (0.2 | ) | | (0.6 | ) | | — |
| | 0.2 |
| | (0.3 | ) |
Total current | (1.3 | ) | | (3.4 | ) | | (2.2 | ) | | — |
| | 0.2 |
| | (0.3 | ) |
Deferred: | | | | | | | | | | | |
Federal | 2.1 |
| | 3.0 |
| | 2.9 |
| | — |
| | — |
| | — |
|
State | — |
| | 0.1 |
| | 0.7 |
| | — |
| | (0.2 | ) | | 0.3 |
|
Total deferred | 2.1 |
| | 3.1 |
| | 3.6 |
| | — |
| | (0.2 | ) | | 0.3 |
|
(Provision) benefit for income taxes | $ | 0.8 |
| | $ | (0.3 | ) | | $ | 1.4 |
| | $ | — |
| | $ | — |
| | $ | — |
|
| |
(1) | For the year ended December 31, 2017, our benefit for income taxes was not material to CMLP’s consolidated statement of operations. |
The effective rate differs from the statutory rate for the years ended December 31, 2017, 2016 and 2015, primarily due to the partnerships not being treated as a corporation for federal income tax purposes as discussed in Note 2.
Deferred income taxes related to CEQP’s wholly owned subsidiaries, IPCH Acquisition Corp., and Crestwood Gas Services GP LLC and our Texas Margin tax reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. For the year ended December 31, 2017, we decreased our net deferred tax liability by $1.3 million to reflect the reduction of corporate tax rates under the Tax Cuts and Jobs Act.
Components of our deferred income taxes at December 31, 2017 and 2016 are as follows (in millions).
|
| | | | | | | | | | | | | | | |
| CEQP | | CMLP |
| December 31, | | December 31, |
| 2017 | | 2016 | | 2017 | | 2016 |
Deferred tax asset: | | | | | | | |
Basis difference in stock of company | $ | 0.2 |
| | $ | 0.2 |
| | $ | — |
| | $ | — |
|
Total deferred tax asset | 0.2 |
| | 0.2 |
| | — |
| | — |
|
Deferred tax liability: | | | | | | | |
Basis difference in stock of acquired company | (3.5 | ) | | (5.5 | ) | | (0.7 | ) | | (0.7 | ) |
Total deferred tax liability | (3.5 | ) | | (5.5 | ) | | (0.7 | ) | | (0.7 | ) |
Net deferred tax liability | $ | (3.3 | ) | | $ | (5.3 | ) | | $ | (0.7 | ) | | $ | (0.7 | ) |
Uncertain Tax Positions. We evaluate the uncertainty in tax positions taken or expected to be taken in the course of preparing our consolidated financial statements to determine whether the tax positions are more likely than not of being sustained by the applicable tax authority. Such tax positions, if any, would be recorded as a tax benefit or expense in the current year. We believe that there were no uncertain tax positions that would impact our results of operations for the years ended December 31, 2017, 2016 and 2015 and that no provision for income tax was required for these consolidated financial statements. However, our conclusions regarding the evaluation of uncertain tax positions are subject to review and may change based on factors including, but not limited to, ongoing analyses of tax laws, regulations and interpretations thereof.