Today it was reported that "thousands" of Americans had their private IRS tax return information stolen and given to a progressive group with the goal of advancing President Biden's proposed tax increases and expanded IRS powers.

The source is currently unknown but it should be noted the IRS has a history of failing to perform basic due diligence in its rehiring decisions, as a report from the Treasury Inspector General shows.

The report found the IRS rehired 11 employees that had conducted "unauthorized access of taxpayer accounts" which was categorized as "serious misconduct."
 
As the Inspector General pointed out, rehiring these employees presents a danger to taxpayers:

“Rehiring prior employees who have experienced conduct and performance issues during their IRS employment presents increased risk to the IRS and taxpayers.”

The American people deserve answers as President Biden has called for the IRS to be given automatic access to snoop on the annual inflow and outflow data from personal bank accounts and Venmo accounts. Can the people trust the IRS to safeguard their private information?

President Biden has also proposed hiring 87,000 new IRS agents and auditors, enough to fill National Park twice.

 

If Biden and Sens. John Hickenlooper and Michael Bennet impose a corporate income tax rate increase, they will have to explain why they just increased your utility bills

If President Biden and congressional Democrats hike the corporate income tax rate, Colorado households and businesses will get stuck with even higher utility bills.

Democrats plan to impose a corporate income tax rate increase to 28%, even higher than communist China's 25%. This does not even include state corporate income taxes, which average 4 - 5% nationwide.

Customers bear the cost of corporate income taxes imposed on utility companies. Corporate income tax cuts drive utility rates down, corporate income tax hikes drive utility rates up.

Electric, gas, and water companies must get their billing rates approved by the respective state utility commissions. When the 2017 Tax Cuts and Jobs Act cut the corporate income tax rate from 35% to 21%, utility companies worked with officials to pass along the tax savings to customers, including at least five Colorado utilities. The savings take the form of either a rate reduction, or, a reduction to an existing/planned rate increase.

Working with the Colorado Public Utilities Commission, Public Service Company Gas Department, Public Service Company Electric Department, Black Hills Energy Electric Utility, Black Hills Energy Gas Utility and Colorado Natural Gas, Inc. passed along tax savings to their customers.

Black Hills Energy Electric Utility: As noted in this January 27, 2021 Black Hills Energy news release: 

Black Hills Energy’s Southern Colorado electric utility residential customers will see the benefits of a federal corporate tax rate reduction in the form of a $50.32 credit on February electric bills. The bill credit is part of a plan approved by the Colorado Public Utilities Commission to return funds to customers resulting from the 2017 Tax Cuts and Jobs Act (TCJA).

As part of the same agreement, Black Hills Energy will also provide residential customers with an additional annual bill credit of approximately $5 beginning in April 2021. The credit will appear on customer bills as a separate line item: "Tax Cuts and Jobs Act Adj."

Public Service Company Gas Department: As noted in this Public Utilities Commission of Colorado document: 

Effective March 1, 2018, the Company’s gas rate case provisional rates will be reduced to reflect the Company’s preliminary estimate of TCJA net impacts of $20 million, as set forth in Appendix A to this Settlement Agreement. The Settling Parties acknowledge that this preliminary estimate in Appendix A is based on high level early estimates using the limited information presently available. To this end, this preliminary estimate includes a contingency to  account for uncertainty and avoid a surcharge to customers in the event the final determination of tax law reductions to rates is lower than the preliminary estimate of the reduction to provisional rates. 

Public Service Company Electric Department: As noted in this Public Utilities Commission of Colorado document:

As set forth in more detail below, the Settling Parties agree that the following TCJA benefits be delivered to Public Service’s electric customers beginning June 1, 2018: 

• $42.0 million – reduction of base rate revenue with a negative General Rate Schedule Adjustment (“GRSA”) of 4.19 percent from June 1, 2018 to December 31, 2018; 
• Extension of the negative 4.19 percent GRSA from January 1, 2019 (annual $67.5 million rate reduction) until new rates take effect from the Company’s next filed rate case; 
• Recovery of the Legacy Pre-Paid Pension Asset: $59.2 million during 2018; and for 2019, $33.7 million (annual) until new rates take effect from the Company’s next filed rate case.
   

Black Hills Energy Gas Utility: As noted on the Black Hills Energy website:

We filed for a reduction to the general rate schedule adjustment, or GRSA, to reflect the savings associated with the federal Tax Cuts and Jobs Act. These benefits first appeared on both gas and electric customers’ July 2018 bills. 

For Colorado gas customers, the GRSA decreased from 0.827% to -2.59%. For Colorado gas distribution customers, the GRSA decreased from 8.56% to 4.41%.

Colorado Natural Gas, Inc.: As noted in this Colorado Natural Gas statement:

At Colorado Natural Gas, our goal is to provide safe, reliable, clean burning and affordable natural gas to individuals, families and businesses in underserved areas of Colorado through exceptional customer service and a commitment to community.

To achieve that goal of providing safe and reliable natural gas to tens of thousands of Coloradans for home heating, hot water, cooking and more, we must maintain and invest in more than 1,200 miles of pipeline, while continuing to provide the quality customer service you’ve come to expect from your local natural gas utility.

All this costs money, which is why we filed a natural gas rate case in May of 2018 with the Colorado Public Utilities Commission (Commission). Until our 2018 rate case, we had not changed our rates since 2013, which meant the cost of providing safe and reliable natural gas exceeded what customers were paying.

After thorough review by the Commission and ample time for public input, the rate case settlement was approved on November 1, 2018. New rates went into effect on December 1, 2018.

New Rates:

• Eastern Colorado District: The service and facility charge is now $14.00 for residential customers, $27.00 for commercial customers, and $40.00 for large volume customers. The new distribution rate is $0.4392 per therm.
• Mountain District (Bailey, Pueblo West and Cripple Creek District): The service and facility charge is now $16.00 for residential customers and $50.82 for commercial customers. The new distribution charge is $1.1428 per therm.

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You may have heard about the benefits of the federal income tax reform passed in 2017. We were happy to be able to pass on those benefits to our customers through this rate case.

Conversely, a vote for a corporate income tax rate hike is a vote for higher utility bills as households try to recover from the pandemic.

Many small businesses operate on tight margins and can't afford higher heating, cooling, gas, and refrigeration costs. President Biden should withdraw his tax increases.

ATR today released a coalition letter signed by 19 organizations and activists in opposition to a proposal by President Biden and Congressional Democrats to raise taxes on American energy producers through eliminating the deduction for intangible drilling costs (IDCs). 

IDCs allows independent energy producers to immediately deduct business expenses related to drilling such as labor, site preparation, repairs, and survey work. 

This provision in not a subsidy, loophole, or giveaway. Instead, it is an important tax provision that promotes investment, job creation, and growth.  

The deduction for IDCs is consistent with immediate expensing offered to all business investments, a policy change instituted in the Tax Cuts and Jobs Act of 2017. Currently, taxpayers can immediately deduct the cost of most assets in the year they are purchased. In this way, eliminating the deduction of IDCs would be highly discriminatory.  

Repealing this provision and raising taxes on oil and gas taxpayers is a reckless policy proposal that will threaten manufacturing jobs across the country, threaten American energy independence, and raise the cost of energy for American families. 

Click here to view the letter or read below. 

Dear Majority Leader Schumer, Republican Leader McConnell, Speaker Pelosi, Republican Leader McCarthy: 

 The undersigned organizations, representing millions of taxpayers, strongly oppose efforts to raise taxes on American energy. Specifically, we are opposed to discriminatory tax increases that would repeal legitimate cost recovery mechanisms like the ability to immediately expense intangible drilling costs (IDCs). This tax hike would eliminate jobs, raise the cost of energy for American families and businesses, and increase global reliance on hostile nations like Iran and Russia for energy. 

For decades, far-left Democrats and activist groups have undertaken a coordinated attack on reliable sources of energy produced in the United States, including oil and natural gas, through schemes like cap-and-trade, bans on hydraulic fracturing, and tax hikes all aimed at “keeping it in the ground.” Most recently, President Biden proposed numerous tax hikes on energy including a tax increase on IDCs in his fiscal year 2022 budget proposal. Senator Bernie Sanders and Representative Ilhan Omar recently introduced legislation that also includes this energy tax hike. 

The current tax treatment of IDCs allows American oil and gas companies to immediately expense the intangible expenses associated with drilling a well, like labor. Immediate expensing is not a “subsidy” nor a “loophole.” It is a legitimate cost recovery mechanism that should be made permanent throughout the tax code to encourage investment and job creation across the economy.  

The negative consequences of a discriminatory tax increase on IDCs would be felt throughout the economy. One study from 2013 found that President Obama’s attempt to raise taxes on IDCs would have eliminated over 230,000 jobs, reduced oil output by 3.8 million barrels/day, and cut U.S. capital investment by over $400 billion. These impacts would be felt across the country, but especially in states like Colorado, New Mexico, Pennsylvania, Texas, and West Virginia. 

 Thankfully, for these reasons, efforts to raise taxes on IDCs have been rejected by members of both parties for years.  

The American shale industry significantly contributed to our country’s ability to emerge from the last economic recession of the early Obama years – we should not impose discriminatory taxes on this industry now, as it is needed to help us recover from the current economic downturn.  

As Congressman Jodey Arrington recently noted in a letter signed by 55 members of Congress, “Using an ‘infrastructure’ package to weaken our energy infrastructure is a grave mistake that will hurt families, farmers, and small businesses still recovering from the pandemic.”  

We agree, and we strongly urge Congress to oppose energy tax increases, especially the discriminatory efforts to repeal the legitimate treatment of intangible drilling costs (IDCs) that support good-paying American jobs across the country.  

 

Sincerely, 

 

Grover Norquist 

President, Americans for Tax Reform 

 

David Williams 

President, Taxpayers Protection Alliance 

 

Garrett Bess 

Vice President, Heritage Action for America 

 

Ryan Ellis 

President, Center for a Free Economy 

 

James L. Martin
Founder/Chairman, 60 Plus Association 

 

Saulius “Saul” Anuzis
President, 60 Plus Association 

 

Carrie Lukas 

President, Independent Women's Forum 

 

Andrew F. Quinlan 

President, Center for Freedom and Prosperity 

 

Heather R. Higgins 

CEO, Independent Women's Voice 

 

Adam Brandon 

President, FreedomWorks 

 

Paul Gessing 

President, Rio Grande Foundation 

 

Daniel Turner 

Executive Director, Power the Future 

 

Brandon Arnold 

Executive Vice President, National Taxpayers Union 

 

Myron Ebell 

Director, Center for Energy and Environment, Competitive Enterprise Institute 

 

Jeff Mazzella 

President, Center for Individual Freedom 

 

Tom Schatz
President, Council for Citizens Against Government Waste 

 

James Taylor 

President, The Heartland Institute 

 

Jon Caldara 

President, Independence Institute 

 

Mario H. Lopez 

President, Hispanic Leadership Fund 

 

If Biden and the Democrats enact a corporate income tax rate increase, they will have to explain why they just increased your utility bills

If President Biden and congressional Democrats hike the corporate income tax rate, Oregon households and businesses will get stuck with even higher utility bills.

Democrats plan to impose a corporate income tax rate increase to 28%, even higher than communist China's 25%. This does not even include state corporate income taxes, which average 4 - 5% nationwide.

Customers bear the cost of corporate income taxes imposed on utility companies. Corporate income tax cuts drive utility rates down, corporate income tax hikes drive utility rates up.

Electric, gas, and water companies must get their billing rates approved by the respective state utility commissions. When the 2017 Tax Cuts and Jobs Act cut the corporate income tax rate from 35% to 21%, utility companies worked with officials to pass along the tax savings to customers, including at least six Oregon utilities. The savings take the form of either a rate reduction, or, a reduction to an existing/planned rate increase.

Working with the Public Utility Commission of Oregon, Avista Utilities, Pacific Power, Idaho Power, Cascade Natural Gas Corporation, Avion Water Company, Inc. and Northwest Natural passed along tax savings to their customers.

Avista Utilities: As noted in this February 11, 2019 Public Utility Commission of Oregon document: 

As explained in more detail below, the Company is requesting a rate decrease of $3,708,000 or 4.2%, effective March 1, 2019. 

The primary purpose of this filing is to pass back the 2018 deferred portion of the benefits attributable to the revisions of the federal income tax code caused by the enactment of the Tax Cuts and Jobs Act signed into law on December 22, 2017. Per discussions with Commission Staff, the Company is requesting less than statutory notice to begin returning the deferred tax benefits of $3.708 million to customers over a twelve month period effective March 1, 2019 to February 29, 2020.

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A residential customer using an average of 47 therms a month could expect their bill to decrease by $2.18 or 4.3%, for a revised monthly bill of $49.02 effective March 1, 2019.

Pacific Power: As noted in this January 31, 2019 DailyEnergyInsider excerpt:

Pacific Power customers in Oregon will see a decrease in their bills beginning Feb. 1 as a result of the Tax Cuts and Jobs Act, Pacific Power said Tuesday.

Residential customers in Oregon will see a bill reduction of approximately 3.8 percent. A typical Oregon residential customer who uses 900 kilowatt hours of electricity per month will see a reduction from roughly $98.52 to approximately $94.40 per month after Feb. 1.

Commercial and industrial customers in the state will see decreases ranging from three percent to four percent, depending on their customer classification.

Northwest Natural: As noted in this October 30, 2018 Portland Business Journal excerpt:

A NW Natural spokeswoman said rates also reflect savings from the Tax Cuts and Jobs Act, which cut the corporate tax rate from 35 percent to 21 percent. It's standard regulatory practice in Oregon for rates to incorporate shifts in the tax burden companies face, up or down

Idaho Power: As noted in this December 29, 2020 Public Utility Commission of Oregon document:

On May 30, 2018, the Commission issued Order No. 18-199 approving a Term Sheet agreed to by Idaho Power, Staff, and the Oregon Citizens' Utility Board, collectively "Parties", that quantified the cost-of-service benefits of the 2017 Tax Act and the 2017 Tax Act impacts associated with the North Valmy power plant levelized revenue requirement. The Parties agreed that the annual Oregon-jurisdictional tax benefits of $1,483,736 are a reasonable quantification of all tax benefits resulting from the 2017 Tax Act for 2018 and 2019. Further, the Parties agreed that the annualized tax benefits will remain in customer rates through May 31, 2020, to provide customers with a full 24-month benefit period associated with 2018 and 2019 tax benefits. In order to facilitate this ratemaking treatment, the Company agreed to request reauthorization from the Commission of the Oregon jurisdictional tax reform benefits authorized in UM 1928. 

On December 23, 2019, Idaho Power filed with the Commission a request to update the quantification of Tax Reform benefits to be included in customer rates beginning June 1, 2020. On May 5, 2020, the Commission issued Order No. 20-148, approving Idaho Power's quantification of $1,519,887 in annualized Oregon jurisdictional benefits associated with Tax Reform and adjusted customer rates to reflect amortization of the Tax Reform benefits effective June 1, 2020. This amount will remain in customer rates until Idaho Power's next general rate case or other proceeding where the then current tax expenses and other tax related revenue requirement components are reflected in rates. 

Cascade Natural Gas Corporation: As noted in this September 12, 2019 Public Utility Commission of Oregon document: 

The parties agreed the Company would return a total of $1.4 million to rate-payers over a 12 month period beginning November 1, 2019. This amount is inclusive of all remaining interim Tax Act benefits and is comprised of $1.2 million dollars for the 2018 deferral period and $200 thousand dollars for the January - March 2019 deferral period. 

Avion Water Company, Inc.: As noted in this March 1, 2021 Public Utility Commission of Oregon document: 

In 2017, the 115th United States Congress passed H.R.1 – Tax Cuts and Jobs Act (H.R.1or Act). The Act was signed into law on December 22, 2017 by President Donald Trump, with most provisions going into effect on January 1, 2018. The Act contains provisions that impact regulated utilities’ federal tax obligations, including a reduction in the corporate income tax rate and the treatment of Contributions in Aid of Construction (CIAC) for water utilities. On March 1, 2018, Staff filed its initial Application for an order authorizing deferred accounting to track the impact, for later ratemaking treatment, of the Tax Act for the twelve month period beginning March 1, 2018. On February 28, 2019, Staff submitted an application for reauthorization to defer these amounts, and again on March 2, 2020, Staff submitted an application for reauthorization of the deferral. These applications were approved by the Public Utility Commission of Oregon (Commission) on November 19, 2020 in Order No. 20-443. The ratemaking treatment for these deferrals is addressed in Avion’s most recent general rate case, Docket UW 181, Order No. 20-488.

This filing is Staff’s application for reauthorization to continue deferring amounts related to the tax benefits associated with the TCJA. While most of the issues associated with TCJA benefits were addressed in Order Nos. 20-443 and 20-488, there is a narrower subset of tax benefits associated with CIAC that require a continued deferral, as described below, to ensure future ratemaking treatment for tax benefits and obligations not currently reflected in rates.

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Staff requests to defer, for later ratemaking treatment, certain CIAC-related tax benefits associated with the Act. The Act resulted in the taxability of CIAC for water utilities, which was not present prior to the Act. The CIAC-related tax obligation will be due to the taxing bodies for the year in which the CIAC is assumed, and will be paid along with other taxes paid for the year in which the CIAC is received. Also beginning in that year, and then for each year over the tax life of the asset, water utilities will claim the tax depreciation of the CIAC assets, which functions as a deduction to the utility’s taxable income (CIAC Tax Benefits). The benefits at issue for this Application are the CIAC Tax Benefits.

Conversely, a vote for a corporate income tax rate hike is a vote for higher utility bills as households try to recover from the pandemic.

Many small businesses operate on tight margins and can't afford higher heating, cooling, gas, and refrigeration costs. President Biden should withdraw his tax increases.