Cheniere Energy, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

Schedule of Components of Income Tax Expense (Benefit)

Income tax provision included in our reported net loss consisted of the following (in thousands):



	Year Ended December 31,
	2014		2013		2012
Current:
Federal	$	—	$	—	$	—
State	—		—		—
Foreign	4,143		4,082		145
Total current	4,143		4,082		145

Deferred:
Federal	—		—		—
State	—		—		—
Foreign	—		258		(141		)
Total deferred	—		258		(141		)
Total income tax provision	$	4,143	$	4,340	$	4

Schedule of Effective Income Tax Rate Reconciliation

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



	Year Ended December 31,
	2014		2013		2012
U.S. federal statutory tax rate	35.0	%	35.0	%	35.0	%
Non-controlling interest	(4.8	)%	(3.3	)%	(1.4	)%
State tax benefit	4.3	%	4.5	%	2.7	%
Uncertain tax position	(12.5	)%	—	%	—	%
Net impact of non-U.S. taxes	(2.0	)%	(0.8	)%	—	%
Valuation allowance	(19.8	)%	(34.3	)%	(33.2	)%
Other	(0.6	)%	(1.9	)%	(3.1	)%
Effective tax rate as reported	(0.4	)%	(0.8	)%	—	%

Schedule of Deferred Tax Assets and Liabilities

Significant components of our deferred tax assets and liabilities at December 31, 2014 and 2013 are as follows (in thousands):



	December 31,
	2014			2013
Deferred tax assets
Net operating loss carryforwards
Federal	$	637,919		$	608,631
State	136,917			111,624
Book deferred gain	77,182			77,182
Share-based compensation expense	28,432			24,089
Property, plant and equipment	29,483			27,260
Other	15,464			3,931
Total deferred tax assets	$	925,397		$	852,717

Deferred tax liabilities
Investment in limited partnership	$	(46,601	)	$	(109,884	)
Other	—			(142		)
Total deferred tax liabilities	$	(46,601	)	$	(110,026	)

Net deferred tax assets	878,796			742,691
Less: net deferred tax asset valuation allowance	(878,796		)	(742,691		)
Total net deferred tax asset	$	—		$	—

Summary of Income Tax Contingencies

Changes in the balance of unrecognized tax benefits are as follows (in thousands):



	Year Ended December 31,
	2014			2013
Balance at beginning of the year	$	19,484		$	19,773
Additions based on tax positions related to current year	85,932			—
Additions for tax positions of prior years	—			2,162
Reductions for tax positions of prior years	(925		)	(2,451		)
Settlements	—			—
Balance at end of the year	$	104,491		$	19,484

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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