Income Taxes

3 Months Ended

Mar. 31, 2021

The reconciliation of the statutory federal income tax rate to our effective tax rate for each of the three months ended March 31, 2021 and 2020 is as follows:



	2021		2020

Federal Statutory Rate	21.0	%	21.0	%
Increases (Decreases) in Tax from:
State Taxes on Income, Net of Federal Tax	5.0		5.0
Production Tax Credits (PTCs)	(7.6)		—
Amortization of Excess Deferred Income Taxes	(2.9)		(4.1)
Corporate-Owned Life Insurance	(0.5)		0.7
North Dakota Wind Tax Credit Amortization, Net of Federal Tax	(0.4)		(0.9)
Excess Tax Deduction on Stock Awards	(0.1)		(1.3)
Allowance for Equity Funds Used During Construction	—		(1.0)
Other, Net	0.3		(0.5)
Effective Tax Rate	14.8	%	18.9	%

We began generating PTCs from our Merricourt wind farm placed in service in the fourth quarter of 2020. No PTCs were generated during the three months ended March 31, 2020. Income tax benefits arising from PTCs are offset by corresponding operating revenue reductions as PTC amounts generated reduce Electric segment customer billings.

- 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 + Details