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Income Tax Expense | 3 Months Ended
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Mar. 31, 2024
Income Tax Disclosure [Abstract] |
Income Tax Expense | INCOME TAX EXPENSE
|  |  |  | Three Months Ended
|  |  |  | March 31,
|  |  |  |  |  | 2024 |  | 2023
Millions |  |  |  |  |  |  |  |
Current Income Tax Expense |  |  |  |  |  |  |  |
Federal (a) |  |  |  |  |  | $3.5 |  | $5.6
State |  |  |  |  |  | 3.4 |  | 2.2
Total Current Income Tax Expense |  |  |  |  |  | $6.9 |  | $7.8
Deferred Income Tax Expense (Benefit) |  |  |  |  |  |  |  |
Federal (b) |  |  |  |  |  | $(5.0) |  | $(8.3)
State |  |  |  |  |  | 2.4 |  | 2.1
Investment Tax Credit Amortization |  |  |  |  |  | (0.3) |  | (0.1)
Total Deferred Income Tax Benefit |  |  |  |  |  | $(2.9) |  | $(6.3)
Total Income Tax Expense |  |  |  |  |  | $4.0 |  | $1.5
(a)For the three months ended March 31, 2024 and 2023, the federal current tax expense was partially offset by production tax credits. (b)For the three months ended March 31, 2024 and 2023, the federal income tax benefit is primarily due to production tax credits. The Company's tax provision for interim periods is determined using an estimate of its annual effective tax rate, adjusted for discrete items arising in that quarter. In each quarter, the Company updates its estimate of the annual effective tax rate and if the estimated annual effective tax rate changes, the Company would make a cumulative adjustment in that quarter.
|  | Three Months Ended
Reconciliation of Taxes from Federal Statutory |  | March 31,
Rate to Total Income Tax Expense |  |  |  | 2024 |  | 2023
Millions |  |  |  |  |  |
Income Before Income Taxes |  |  |  | $41.0 |  |  | $39.1 |
Statutory Federal Income Tax Rate |  |  |  | 21 | % |  | 21 | %
Income Taxes Computed at Statutory Federal Rate |  |  |  | $8.6 |  |  | $8.2 |
Increase (Decrease) in Income Tax Due to: |  |  |  |  |  |
State Income Taxes – Net of Federal Income Tax Benefit |  |  |  | 4.6 |  |  | 3.4 |
Production Tax Credits (a) |  |  |  | (11.6) |  |  | (10.4) |
Investment Tax Credits (a) |  |  |  | (0.3) |  |  | (2.2) |
Regulatory Differences – Excess Deferred Tax |  |  |  | (3.5) |  |  | (2.8) |
Non-Controlling Interest in Subsidiaries |  |  |  | 2.8 |  |  | 3.8 |
AFUDC – Equity |  |  |  | (0.6) |  |  | (0.3) |
Other |  |  |  | 4.0 |  |  | 1.8 |
Total Income Tax Expense |  |  |  | $4.0 |  |  | $1.5 |
(a)For the three months ended March 31, 2024 and 2023, the credits are presented net of any estimated discount on the sale of certain credits. For the three months ended March 31, 2024, the effective tax rate was 9.7 percent (3.8 percent for the three months ended March 31, 2023). The effective tax rates for 2024 and 2023 were primarily impacted by production tax credits. Uncertain Tax Positions. As of March 31, 2024, we had gross unrecognized tax benefits of $1.1 million ($1.1 million as of December 31, 2023). Of the total gross unrecognized tax benefits, $0.6 million represents the amount of unrecognized tax benefits included on the Consolidated Balance Sheet that, if recognized, would favorably impact the effective income tax rate. The unrecognized tax benefit amounts have been presented as an increase to the net deferred tax liability on the Consolidated Balance Sheet. ALLETE and its subsidiaries file a consolidated federal income tax return as well as combined and separate state income tax returns in various jurisdictions. ALLETE is currently under examination by the state of Minnesota for the tax years 2020 through 2022. ALLETE has no open federal audits and is no longer subject to federal examination for years before 2021 or state examination for years before 2020. Additionally, the statute of limitations related to the federal tax credit carryforwards will remain open until those credits are utilized in subsequent returns.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-13 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//740/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-14 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-21 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482526/740-270-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-17 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482603/740-30-50-2 + Details
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