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Income Taxes | 6 Months Ended
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Jun. 30, 2022
Income Tax Disclosure [Abstract] |
Income Taxes | NOTE 7. IN COME TAXES In accordance with interim reporting requirements, the Company uses an estimated annual effective tax rate for computing its provisions for income taxes. An estimate of annual income tax expense (or benefit) is made each interim period using estimates for annual pre-tax income, income tax adjustments, and tax credits. The estimated annual effective tax rates do not include discrete events such as tax law changes, examination settlements, accounting method changes, or adjustments to tax expense or benefits attributable to prior years. Discrete events are recorded in the interim period in which they occur or become known. The estimated annual tax rate is applied to year-to-date pre-tax income to determine income tax expense (or benefit) for the interim period consistent with the annual estimate. In subsequent interim periods, income tax expense (or benefit) for the period is computed as the difference between the year-to-date amount reported for the previous interim period and the current period’s year-to-date amount. The following table summarizes the significant factors impacting the difference between our effective tax rate and the federal statutory rate for the three and six months ended June 30 (dollars in thousands):
|  | Three months ended June 30, |  |  | Six months ended June 30, |
|  | 2022 |  |  | 2021 |  |  | 2022 |  |  | 2021 |
Federal income taxes at statutory rates |  | $ | 2,195 |  |  |  | 21.0 | % |  | $ | 3,459 |  |  |  | 21.0 | % |  | $ | 14,948 |  |  |  | 21.0 | % |  | $ | 20,297 |  |  |  | 21.0 | %
Increase (decrease) in tax resulting from: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Flow through related to deduction of meters and mixed service costs (1) |  |  | (2,401 | ) |  |  | (23.0 | ) |  |  | — |  |  |  | — |  |  |  | (19,835 | ) |  |  | (27.9 | ) |  |  | — |  |  |  | — |
Tax effect of regulatory treatment of utility plant differences (2) |  |  | (976 | ) |  |  | (9.3 | ) |  |  | (1,085 | ) |  |  | (6.6 | ) |  |  | (7,298 | ) |  |  | (10.3 | ) |  |  | (7,051 | ) |  |  | (7.3 | )
State income tax expense |  |  | 78 |  |  |  | 0.7 |  |  |  | 241 |  |  |  | 1.5 |  |  |  | 901 |  |  |  | 1.3 |  |  |  | 719 |  |  |  | 0.7 |
Settlement of equity awards |  |  | — |  |  |  | — |  |  |  | (21 | ) |  |  | (0.1 | ) |  |  | (19 | ) |  |  | — |  |  |  | 909 |  |  |  | 1.0 |
Other |  |  | 105 |  |  |  | 1.0 |  |  |  | (196 | ) |  |  | (1.2 | ) |  |  | (532 | ) |  |  | (0.7 | ) |  |  | (312 | ) |  |  | (0.3 | )
Total income tax expense (benefit) |  | $ | (999 | ) |  |  | (9.6 | )% |  | $ | 2,398 |  |  |  | 14.6 | % |  | $ | (11,835 | ) |  |  | (16.6 | )% |  | $ | 14,562 |  |  |  | 15.1 | %
(1) In September and October 2021, new rates from the Company's Idaho and Washington general rate cases went into effect. While there were base rate increases approved in each of the cases, these base rate increases were offset by tax customer credits which resulted in no increase in customer billing rates. As the tax customer credits are returned to customers, this results in a decrease to income tax expense as a result of flowing through the benefits related to meters and mixed service costs. This decrease in income tax expense represents the benefits to the Company as a result of these general rate cases. (2) In 2017, the Tax Cuts and Jobs Act (TCJA) reduced the corporate income tax rate, which resulted in a reduction to deferred income tax assets and liabilities. Prior to 2022, for depreciation-related temporary differences that are returned to customers, the Company utilized the average rate assumption method to compute the amounts returned to customers. Beginning in 2022, the Company changed to the alternative method provided for in the TCJA, to be in compliance with recently released revenue procedures and private letter rulings.

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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 -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI https://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI https://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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