1) Temp: Med high.
If you like thicker toffee, butter a 9x13 inch pan. For thinner toffee, butter a jelly roll pan.
Put the butter, sugar and water into a deep Teflon frying pan, a heavy cast iron fry pan, or a Dutch oven. Stir constantly in one direction. If you are using a Teflon pan you do not need to keep the sides washed down. Cook until the mixture is the color of a brown paper sack, or if you want to do it by temperature 280 degrees. This will take about 15 minutes or so. You can test whether it is done by dropping some of the toffee into cold water to see if it crunches instead of chews. But you can also just go by the color of the toffee.
2) Stir half of the chopped nuts into the toffee just before you take it off the stove to put into the pan. Pour into prepared pan. After it hardens sprinkle the warm (not hot) candy with chocolate chips, let them melt then spread the chocolate over the toffee and sprinkle with nuts. If the toffee is too cool to melt the chocolate you can put the whole pan under the broiler for a minute to melt the chocolate. Note: If you just melt the chocolate and spread over the cooled toffee, the chocolate peels off when you are trying to break up the toffee, so it is important to get the top of the toffee slight warm for better adhesion.
3) After it has hardened, turn pan upside down and the toffee will come out. Then break apart.