Company: WELPM
Filing Date: 2025-05-07
Form Type: 10-Q
Source: 0000107815-25-000184
Chunk: 37

Company: WISCONSIN ELECTRIC POWER CO
Filing Date: 2025-05-07
Form: 10-Q
Item: Part I, Item 1
Chunk 37
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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, 2025Three Months Ended March 31, 2024(in millions)AmountEffective Tax RateAmountEffective Tax RateStatutory federal income tax$48.6 21.0 %$35.7 21.0 %State income taxes net of federal tax benefit14.1 6.1 %10.0 5.9 %PTCs, net(13.0)(5.6)%(5.1)(3.0)%Federal excess deferred tax amortization(7.0)(3.0)%(5.7)(3.4)%Tax repairs(5.2)(2.2)%1.1 0.7 %AFUDC-Equity(5.0)(2.2)%(3.2)(1.9)%Domestic production activities deferral2.0 0.8 %1.7 1.0 %Other, net0.8 0.3 %1.3 0.7 %Total income tax expense$35.3 15.2 %$35.8 21.0 %The effective tax rate for the three months ended March 31, 2025, differs from the United States statutory federal income tax rate of 21%, primarily due to PTCs, the impact of the protected deferred tax benefits associated with the Tax Legislation, as discussed in more detail below, and the flow through of tax repairs in connection with our rate order approved by the PSCW, effective January 1, 2025. These items were partially offset by state income taxes.The effective tax rate for the three months ended March 31, 2024, does not materially differ from the United States statutory federal income tax rate of 21%. This is primarily due to the impact of the protected deferred tax benefits associated with the Tax Legislation, as discussed in more detail below, and PTCs, 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). The IRA contains a tax credit transferability provision that allows us to sell PTC