How We Serve: Tax Team

As businesses grow, so do their complexities. It’s of the utmost importance to have financial professionals available to navigate these changes so fiscal obligations and tax ramifications remain in check.

Scott Johnson is Basin Electric’s director of Tax and has served in this role for four and a half years. Johnson leads a team of three tax analysts, each of whom is responsible for monitoring income, property, and sales tax for Basin Electric and its subsidiaries.

The tax department has two overarching responsibilities. First, they keep Basin Electric, and its subsidiaries, compliant on income, property, and sales tax liabilities.

Second, they provide and maintain accurate and timely income tax expenses and deferred income tax balances for the preparation of income statements and balance sheets for Basin Electric and their subsidiaries.

“My favorite part of the job is overseeing the compliance requirements for three different types of taxes (income, property, and sales),” Johnson says. “This requires our department to stay on top of emerging issues and work closely with several other departments within the cooperative.”

With teamwork being one of Basin Electric’s core values, it’s important to highlight the different departments the Tax team collaborates with, as well as the importance of their ongoing communication.

“We work with many different departments within Basin Electric including Property and Right-of-Way, Geographic Information Systems (GIS), Accounts Payable, Financial Reporting and Planning, Capital Assets, Settlements, Commodity Risk, Procurement, Human Resources, Marketing, Legal, and many external state departments of revenue,” Johnson says.

It’s important the Tax team is kept in the loop when certain transactions are being discussed within the cooperative so the tax ramifications are known ahead of time.

“We are proactive as opposed to reactive. We are always working to improve communication between our group and other departments across Basin Electric,” Johnson says.

Continuous monitoring is required to stay informed on the latest changes in tax laws and regulations. Johnson and his team use a tax research tool called Thompson Reuters that sends daily and/or weekly emails detailing various changes. They also receive information periodically from various accounting firms.

Two of the tax analysts are certified public accountants and are required to complete continuing education each year, and some of that may include information on changes in tax law.

When asked what trends or developments could shape the future of tax analysis, Johnson says, “I believe there will always be changes to tax laws, regulations, and tax rates depending on federal and state income needs and leadership directives. Looking ahead, I foresee possible changes in the way information for the returns and provision is gathered as technology continues to improve.”

By ensuring the financial health, compliance, and future success of Basin Electric, tax analysts are an essential asset to Basin Electric’s member cooperatives.

As a not-for-profit, Basin Electric’s net margin above expenses and reserves does not belong to the utility. It represents an increase in an investment that belongs to our member-owners. Basin Electric’s margins must be used to improve or maintain operations, set aside in reserves, or distributed back to the members.

“At the end of the day, our job is to reduce expenses so Basin Electric can continue providing affordable electricity to our members at the end of the line,” Johnson says.