Company: SREA
Filing Date: 2025-11-05
Form Type: 10-Q
Source: 0001032208-25-000065
Chunk: 277

Company: SEMPRA
Filing Date: 2025-11-05
Form: 10-Q
Item: Item 8
Chunk 277
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    Represents net investment gains (losses) on dedicated assets in support of our executive retirement and deferred compensation plans. These amounts are offset by corresponding changes in compensation expense related to the plans, recorded in O&M on the Condensed Consolidated Statements of Operations.

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INCOME TAXESWe provide our calculations of ETRs in the following table.INCOME TAX EXPENSE (BENEFIT) AND EFFECTIVE INCOME TAX RATES(Dollars in millions)Three months ended September 30,Nine months ended September 30,2025202420252024Sempra:Income tax expense (benefit)$482 $(105)$711 $(63)Income before income taxes and equity earnings$160 $200 $1,109 $1,213 Equity earnings, before income tax(1)133 132 443 426 Pretax income$293 $332 $1,552 $1,639 Effective income tax rate165 %(32)%46 %(4)%SDG&E:Income tax (benefit) expense$(33)$15 $(12)$89 Income before income taxes$291 $276 $768 $759 Effective income tax rate(11)%5 %(2)%12 %SoCalGas:Income tax (benefit) expense$(95)$(52)$(51)$1 (Loss) income before income taxes$(49)$(66)$523 $477 Effective income tax rate194 %79 %(10)%— %(1)    We discuss how we recognize equity earnings in Note 5 of the Notes to Consolidated Financial Statements in the Annual Report.Sempra, SDG&E and SoCalGas record income taxes for interim periods utilizing a forecasted ETR anticipated for the full year. Unusual and infrequent items and items that cannot be reliably estimated are recorded in the interim period in which they occur, which can result in variability in the ETR. For SDG&E and SoCalGas, the CPUC requires flow-through rate-making treatment for the current income tax benefit or expense arising from certain property-related and other temporary differences between the treatment for financial reporting and income tax, which will reverse over time. Under the regulatory accounting treatment required for these flow-through temporary differences, deferred income tax assets and liabilities are not recorded to deferred income tax expense, but rather to a regulatory asset or liability that will be flowed through to customers in the future, which impacts the ETR