Income Taxes

3 Months Ended

Dec. 03, 2022

Income Taxes [Abstract]

Income Taxes

Note 10. Income Taxes

During the thirteen-week period ended December 3, 2022, there were no material changes in unrecognized tax benefits.

On March 27, 2020, the CARES Act was signed into law, which is intended to provide economic relief to those impacted by the COVID-19 pandemic. On March 11, 2021, the American Rescue Plan Act (the “ARPA”) was signed into law. The ARPA includes several provisions, such as measures that extend and expand the ERC provision, previously enacted under the CARES Act, through December 31, 2021. The Company has filed a refund claim in connection with the ERC and will account for the potential ERC refund, if any, upon Internal Revenue Service approval and receipt.

The CARES Act provides for the deferral of the employer-paid portion of social security payroll taxes. The Company elected to defer the employer-paid portion of social security payroll taxes through December 31, 2020 of $18,887. Of this amount, half was remitted in December 2021 and the remaining half was remitted in December 2022.

The Company’s effective tax rate was 24.7% for the thirteen-week period ended December 3, 2022, as compared to 23.5% for the thirteen-week period ended November 27, 2021. The increase in the effective tax rate was primarily due to a lower tax benefit from stock-based compensation.