Exelon (EXC - Get Report) said "federal healthcare legislation was recently signed into law. The healthcare legislation includes a provision that reduces the deductibility, for federal income tax purposes, of retiree healthcare costs to the extent an employer's postretirement healthcare plan receives federal subsidies that provide retiree prescription drug benefits equivalent to Medicare prescription drug benefits." Because of these changes, the company now expect to record total non-cash after-tax charges of about $65 million for income tax expense to establish deferred tax liabilities in the first quarter of 2010 .
The reduction of these income tax deductions is also estimated to increase Exelon's total annual income tax expense by about $10 million to $15 million. Of this total, annual income tax expense of subsidiaries Generation, ComEd and PECO is estimated to increase $5 million to $8 million, $3 million to $4 million and $1 million to $2 million, respectively.