XML 64 R45.htm IDEA: XBRL DOCUMENT v3.20.4

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense (Benefit)

Income tax expense (benefit) from continuing operations for the years ended December 31 was (in thousands):

			2020			2019			2018
Current:
Federal			$	(6,020)		$	(8,578)		$	325
State			847			138			247
Current income tax expense (benefit)			(5,173)			(8,440)			572
Deferred:
Federal			35,672			34,551			(25,022)
State			2,419			3,469			783
Deferred income tax expense (benefit)			38,091			38,020			(24,239)
Income tax expense (benefit)			$	32,918		$	29,580		$	(23,667)

Schedule of Effective Income Tax Rate Reconciliation

Effective Tax Rates

The effective tax rate differs from the federal statutory rate for the years ended December 31, as follows:

			2020			2019			2018
Federal statutory rate			21.0		%	21.0		%	21.0		%
State income tax (net of federal tax effect)			2.4			1.5			2.3
Non-controlling interest (a)			(1.2)			(1.2)			(1.3)
Tax credits(b) (c)			(9.2)			(3.9)			(2.0)
Flow-through adjustments (d)			(1.6)			(2.4)			(1.6)
Jurisdictional consolidation project (e)			—			—			(28.5)
Uncertain Tax Benefits			1.5			—			—
Valuation Allowance			0.7			—			—
Other tax differences			0.6			(1.6)			(0.1)
TCJA corporate rate reduction (f)			—			—			1.6
Amortization of excess deferred income tax expense (g)			(2.3)			(1.2)			(0.7)
Effective Tax Rate			11.9		%	12.2		%	(9.3)		%

_________________________

(a)    The effective tax rate reflects the income attributable to the noncontrolling interest in Black Hills Colorado IPP for which a tax provision was not recorded.

(b)    The current year increase of PTCs reflect full year production of two wind facilities that were acquired/ placed into service during 2019; Top of Iowa purchased February 2019 and Busch Ranch II with an in-service date of November 2019. Additionally, in November 2020, the Corriedale qualifying wind facility was placed in service.

(c)    In 2020, the Company completed a research and development study which encompassed tax years from 2013 to 2019.

(d)    Flow-through adjustments related primarily to accounting method changes for tax purposes that allow us to take a current tax deduction for repair costs and certain indirect costs. We recorded a deferred income tax liability in recognition of the temporary difference created between book and tax treatment and flowed the tax benefit through to tax expense. A regulatory asset was established to reflect the recovery of future increases in taxes payable from customers as the temporary differences reverse. As a result of this regulatory treatment, we continue to record tax benefits consistent with the flow-through method.

(e)    In 2018, the Company restructured certain legal entities from earlier acquisitions, which resulted in additional deferred income tax assets of $73 million, related to goodwill that is amortizable for tax purposes, and deferred tax benefits of $73 million.

(f)    On December 22, 2017, the TCJA was signed into law reducing the federal corporate rate from 35% to 21% effective January 1, 2018. During the year ended December 31, 2018, we recorded $4.0 million of additional tax expense associated with changes in the prior estimated impacts of TCJA related items.

(g)    Primarily TCJA - see above.

Schedule of Deferred Tax Assets and Liabilities

The temporary differences, which gave rise to the net deferred tax liability, for the years ended December 31 were as follows (in thousands):

			2020			2019
Deferred tax assets:
Regulatory liabilities			$	90,535		$	89,754
State tax credits			23,339			23,261
Federal NOL			96,155			120,624
State NOL			9,914			13,537
Partnership			15,601			14,030
Credit Carryovers			51,445			27,139
Other deferred tax assets			40,143			33,395
Less: Valuation allowance			(13,943)			(12,063)
Total deferred tax assets			313,189			309,677
Deferred tax liabilities:
Accelerated depreciation, amortization and other property-related differences			(551,137)			(533,292)
Regulatory assets			(28,007)			(23,586)
Goodwill			(30,590)			(15,875)
State deferred tax liability			(73,910)			(72,911)
Other deferred tax liabilities			(38,169)			(24,732)
Total deferred tax liabilities			(721,813)			(670,396)
Net deferred tax liability			$	(408,624)		$	(360,719)

Summary of Operating Loss Carryforwards

At December 31, 2020, we have federal and state NOL carryforwards that will expire at various dates as follows (in thousands):

						Amounts						Expiration Dates
Federal NOL Carryforward						$	378,236					2022			to			2037
Federal NOL Carryforward						$	79,644					No expiration
State NOL Carryforward (a)						$	173,867					2021			to			2040

_________________________

(a)    The carryforward balance is reflected on the basis of apportioned tax losses to jurisdictions imposing state income taxes.

Summary of Income Tax Contingencies

The following table reconciles the total amounts of unrecognized tax benefits, without interest, at the beginning and end of the period included in Other deferred credits and other liabilities on the accompanying Consolidated Balance Sheets (in thousands):

			Changes in Uncertain Tax Positions
Beginning balance at January 1, 2018			$	3,263
Additions for prior year tax positions			251
Reductions for prior year tax positions			(417)
Additions for current year tax positions			486
Settlements			—
Ending balance at December 31, 2018			3,583
Additions for prior year tax positions			446
Reductions for prior year tax positions			(862)
Additions for current year tax positions			998
Settlements			—
Ending balance at December 31, 2019			4,165
Additions for prior year tax positions			3,788
Reductions for prior year tax positions			(1,313)
Additions for current year tax positions			1,743
Settlements			—
Ending balance at December 31, 2020			$	8,383

Summary of State Tax Carryforwards

State tax credits have been generated and are available to offset future state income taxes. At December 31, 2020, we had the following state tax credit carryforwards (in thousands):

State Tax Credit Carryforwards						Expiration Year
ITC			$	23,060		2023			to			2041
Research and development			$	278		No expiration

X

- References

No definition available.

+ Details

Name:	us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix:	us-gaap_
Data Type:	xbrli:stringItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32639-109319

+ Details

Name:	us-gaap_ScheduleOfComponentsOfIncomeTaxExpenseBenefitTableTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32537-109319

+ Details

Name:	us-gaap_ScheduleOfDeferredTaxAssetsAndLiabilitiesTableTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 12
-URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32687-109319

+ Details

Name:	us-gaap_ScheduleOfEffectiveIncomeTaxRateReconciliationTableTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure for 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 and other income tax contingencies. Includes, but is not limited to, interest and penalties, reconciliation of unrecognized tax benefits, unrecognized tax benefits that would affect the effective tax rate, tax years that remain subject to examination by tax jurisdictions, and information about positions for which it is reasonably possible that amounts unrecognized will significantly change within 12 months.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 15A
-URI http://asc.fasb.org/extlink&oid=84230637&loc=SL6600010-109319

Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 15
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32718-109319

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 19
-URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32840-109319

+ Details

Name:	us-gaap_SummaryOfIncomeTaxContingenciesTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of pertinent information, such as tax authority, amounts, and expiration dates, of net operating loss carryforwards, including an assessment of the likelihood of utilization.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32559-109319

+ Details

Name:	us-gaap_SummaryOfOperatingLossCarryforwardsTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of tax credit carryforwards available to reduce future taxable income, including amounts, expiration dates, limitations on use and the related deferred tax assets and valuation allowances.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32559-109319

+ Details

Name:	us-gaap_SummaryOfTaxCreditCarryforwardsTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration