INCOME TAXES (Tables)

12 Months Ended

Dec. 29, 2018

Schedule of income tax expense (benefit)

In fiscal 2017, the Company estimated and recognized approximately $41,935 of tax expense for the 2017 Tax Act. The SEC staff issued SAB 118, which provided guidance on accounting for the tax effects of the 2017 Tax Act.

The Company's accounting for the following element of the 2017 Tax Act was finalized as of December 30, 2017:

Reduction of U.S. federal corporate tax rate: The 2017 Tax Act reduces the corporate tax rate to 21 percent, effective January 1, 2018. Consequently, we have recorded a decrease related to deferred taxes of $20,372, with a corresponding net adjustment to deferred income tax expense for the year ended December 30, 2017.

(10) INCOME TAXES (Continued)

The Company's accounting for the following elements of the 2017 Tax Act were provisional estimates at December 30, 2017, and were finalized as of December 29, 2018 as follows:

Deemed Repatriation transition tax: The Deemed Repatriation transition tax (“Transition Tax”) is a tax on unremitted foreign earnings of certain foreign subsidiaries, which subjected the Company's unremitted foreign earnings of approximately $394,000 to tax at certain specified rates less associated foreign tax credits. The Company recorded a Transition Tax obligation of $9,890 during fiscal 2017 and reduced this expense by $550 in 2018 upon finalization.

Indefinite reinvestment assertion: The Company position remains that unremitted foreign earnings subject to the Transition Tax are not indefinitely reinvested. The Company recorded foreign withholding taxes and U.S. state income taxes of $10,373 and $1,300. This expense was recorded in 2017 with a decrease of only $140 recognized in 2018 as it was finalized. In addition, the Company has taken the position that on non-U.S. subsidiaries, the 2018 unremitted foreign earnings are not indefinitely reinvested and it recorded additional foreign withholding taxes and U.S. state income taxes of $918 and $99, respectively during 2018.

Income tax expense (benefit) consi

Schedule of reconciliation of statutory federal income tax rate and effective tax rate

inued)

The reconciliations of the statutory federal income tax rate and the effective tax rate fo

Schedule of tax effects of significant items comprising net deferred income tax liabilities

ble.

Deferred income taxes reflect the net tax effects of (a) temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, and (b) operating loss and tax credit carryforwards. The tax effects of significant items comprising the Company’s net deferred income tax liabilities are as follows:

(10) INCOME TAXES (Cont

Schedule of deferred income tax assets (liabilities) presented on the Consolidated Balance Sheets

ed)



	2018			2017
Deferred income tax assets:
Accrued expenses and allowances	$	4,354		$	13,373
Accrued insurance	644			818
Tax credits and loss carryforwards	56,867			54,521
Defined benefit pension liability	36,328			47,459
Inventory allowances	4,384			3,433
Accrued warranty	3,914			4,602
Deferred compensation	28,706			29,421
Gross deferred income tax assets	135,197			153,627
Valuation allowance	(33,228		)	(27,864		)
Net deferred income tax assets	101,969			125,763
Deferred income tax liabilities:
Work in progress	1,064			1,805
Property, plant and equipment	25,477			26,826
Intangible assets	44,850			39,613
Future repatriation of foreign earnings	2,746			11,673
Other liabilities	4,545			1,819
Total deferred income tax liabilities	78,682			81,736
Net deferred income tax asset	$	23,287		$	44,027

Deferred income tax assets (liabilities) are presented as follows on the Consolidated Balance

Schedule of activity related to unrecognized tax benefits

inued)

The following summarizes the activity related to our unrecognized tax benefits in 2018 and 2017, in tho