I don't know if it helps the diagnosis of this plant, but I live in Canada.
I am scared to cut it to the ground. That said, it does come back every year so maybe thats the way to go. If I cut it that low, will it grow back to about 2 feet high again this year?
You can leave a few inches if you want, but you want to remove the dead stuff before the new growth starts in spring or it'll be a nightmare to remove the dead without damaging the tender new shoots. I can't remember if yarrow is one of those that basically gets soft just below ground and you can remove entire stalks with a tug or twist and a tug. I've been doing that with a lot of my perennials during spring clean up.
Some of them HAS to be clipped with a pruner and are a pain, but I do those along with the ones that retain some green stems and need to be trimmed of frost killed upper and tip growths.