INCOME TAXES

3 Months Ended

Mar. 31, 2022

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

The provision for income taxes differs from the amount of income tax determined by applying the applicable United States statutory federal income tax rate to income before income taxes as a result of the following:

	Three Months Ended March 31, 2022				Three Months Ended March 31, 2021
(in millions)	Amount		Effective Tax Rate		Amount		Effective Tax Rate
Statutory federal income tax	$	21.1	21.0	%	$	16.4	21.0	%
State income taxes net of federal tax benefit	6.4		6.4	%	4.9		6.3	%
Federal excess deferred tax amortization	(1.6)		(1.6)	%	(1.6)		(2.1)	%
Federal excess deferred tax amortization – Wisconsin unprotected	(1.2)		(1.2)	%	(10.5)		(13.4)	%
Other	(0.7)		(0.7)	%	(0.5)		(0.6)	%
Total income tax expense	$	24.0	23.9	%	$	8.7	11.2	%

The effective tax rate of 23.9% for the three months ended March 31, 2022, differs from the United States statutory federal income tax rate of 21%, primarily due to state income taxes. This item was partially offset by the impact of the protected deferred tax benefits associated with the Tax Legislation, as discussed in more detail below.

The effective tax rate of 11.2% for the three months ended March 31, 2021, differs from the United States statutory federal income tax rate of 21%, primarily due to the recognition of certain unprotected deferred tax benefits created as a result of the Tax Legislation. Effective January 1, 2020, in accordance with the rate order received from the PSCW in December 2019, we began amortizing the unprotected deferred tax benefits over periods ranging from two years to four years, to reduce near-term rate impacts to our customers. This item was partially offset by state income taxes.

The Tax Legislation required us to remeasure the deferred income taxes at our utility segment and we began to amortize the resulting excess protected deferred income taxes beginning in 2018 in accordance with normalization requirements (see federal excess deferred tax amortization line above).

See Note 23, Regulatory Environment, in our 2021 Annual Report on Form 10-K for additional information on unprotected tax benefits.