Income Taxes

9 Months Ended

Sep. 30, 2023

Income Taxes [Line Items]

Income Taxes

Income Taxes

Presented in the following table is a reconciliation of the statutory U.S. federal income tax rate to the effective income tax rate from continuing operations:

Nine Months Ended September 30	2023			2022
CMS Energy, including Consumers
U.S. federal income tax rate		21.0	%		21.0	%
Increase (decrease) in income taxes from:
State and local income taxes, net of federal effect1		1.7			5.6
Renewable energy tax credits		(6.9)			(5.8)
TCJA excess deferred taxes2		(3.9)			(7.2)
Accelerated flow-through of regulatory tax benefits3		—			(4.3)
Other, net		0.8			0.7
Effective tax rate		12.7	%		10.0	%
Consumers
U.S. federal income tax rate		21.0	%		21.0	%
Increase (decrease) in income taxes from:
State and local income taxes, net of federal effect1		2.9			5.3
Renewable energy tax credits		(4.5)			(4.3)
TCJA excess deferred taxes2		(3.7)			(5.9)
Accelerated flow-through of regulatory tax benefits3		—			(3.5)
Other, net		(0.1)			0.1
Effective tax rate		15.6	%		12.7	%

1CMS Energy initiated a plan to divest immaterial business activities in a non‑Michigan jurisdiction and will no longer have a taxable presence within that jurisdiction after 2023. As a result of these actions, CMS Energy reversed a $13 million non‑Michigan reserve, all of which was recognized at Consumers.

2In 2020, the MPSC authorized Consumers to accelerate the amortization of the gas portion of its regulatory liability associated with unprotected, non-property-related excess deferred income taxes resulting from the TCJA. This portion of the regulatory liability was fully amortized in 2022.

3In 2020, the MPSC authorized Consumers to accelerate the amortization of income tax benefits associated with the cost to remove gas plant assets. These tax benefits were fully amortized in 2022.

Consumers Energy Company

Income Taxes [Line Items]

Income Taxes

Income Taxes

Presented in the following table is a reconciliation of the statutory U.S. federal income tax rate to the effective income tax rate from continuing operations:

Nine Months Ended September 30	2023			2022
CMS Energy, including Consumers
U.S. federal income tax rate		21.0	%		21.0	%
Increase (decrease) in income taxes from:
State and local income taxes, net of federal effect1		1.7			5.6
Renewable energy tax credits		(6.9)			(5.8)
TCJA excess deferred taxes2		(3.9)			(7.2)
Accelerated flow-through of regulatory tax benefits3		—			(4.3)
Other, net		0.8			0.7
Effective tax rate		12.7	%		10.0	%
Consumers
U.S. federal income tax rate		21.0	%		21.0	%
Increase (decrease) in income taxes from:
State and local income taxes, net of federal effect1		2.9			5.3
Renewable energy tax credits		(4.5)			(4.3)
TCJA excess deferred taxes2		(3.7)			(5.9)
Accelerated flow-through of regulatory tax benefits3		—			(3.5)
Other, net		(0.1)			0.1
Effective tax rate		15.6	%		12.7	%

1CMS Energy initiated a plan to divest immaterial business activities in a non‑Michigan jurisdiction and will no longer have a taxable presence within that jurisdiction after 2023. As a result of these actions, CMS Energy reversed a $13 million non‑Michigan reserve, all of which was recognized at Consumers.

2In 2020, the MPSC authorized Consumers to accelerate the amortization of the gas portion of its regulatory liability associated with unprotected, non-property-related excess deferred income taxes resulting from the TCJA. This portion of the regulatory liability was fully amortized in 2022.

3In 2020, the MPSC authorized Consumers to accelerate the amortization of income tax benefits associated with the cost to remove gas plant assets. These tax benefits were fully amortized in 2022.