Income Taxes

9 Months Ended

Oct. 08, 2022

Income Tax Disclosure [Abstract]

Income Taxes

17. INCOME TAXES

The company’s effective tax rate for the twelve weeks ended October 8, 2022 was 25.3% compared to 23.7% for the twelve weeks ended October 9, 2021. The increase in the rate was primarily due to larger favorable discrete items related to tax credits in the prior year quarter. During the twelve weeks ended October 8, 2022, the primary differences in the effective rate and the statutory rate were state income taxes, which includes the recognition of a discrete benefit related to state tax credits.

The company’s effective tax rate for the forty weeks ended October 8, 2022 was 23.4% compared to 23.7% for the forty weeks ended October 9, 2021. The decrease in the rate was primarily due to favorable windfalls on stock-based compensation recorded discretely in the current year. During the forty weeks ended October 8, 2022, the primary differences in the effective rate and the statutory rate were state income taxes including the recognition of discrete state credits and windfalls on stock-based compensation.

During the forty weeks ended October 8, 2022, the company’s activity with respect to its uncertain tax positions and related interest expense accrual was not significant to the Condensed Consolidated Financial Statements. As of October 8, 2022, we do not anticipate significant changes to the amount of gross unrecognized tax benefits over the next twelve months.