Income Taxes

3 Months Ended

Apr. 02, 2022

Income Tax Disclosure [Abstract]

Income Taxes

NOTE 12. INCOME TAXES

We had an income tax expense of $7.8 million for the three months ended April 2, 2022, compared with income tax expense of $3.9 million for the three months ended April 3, 2021. Our effective tax rate for the three months ended April 2, 2022, was an expense rate of 24.7%, and was an expense rate of 23.6% for the three months ended April 3, 2021. Our income tax expense for the three-month periods ended April 2, 2022, and April 3, 2021, includes $505 thousand and $305 thousand, respectively, relating to our 75% share of the pre-tax earnings of Eco.

Income tax expense in the three months ended April 2, 2022 and April 3, 2021 include discrete items of income tax benefit relating to excess tax benefits from the lapses of restrictions on stock awards, which totaled $136 thousand in the three months ended April 2, 2022, and $95 thousand in the three months ended April 3, 2021. The effect of these discrete items on our effective tax rates for these periods was not significant.

In September 2021, the state of Florida announced that the corporate income tax rate for the 2021 tax year was being lowered from its then current level of 4.458% to 3.535%. However, for 2022, Florida's corporate income tax rate returned to its statutory level before the passage of the Tax Cuts and Jobs Act, which is 5.5%. As such, we adjusted our annual effective tax rate for 2022 to include this increase in rate in Florida, where a substantial portion of our business is apportioned, to an estimated combined statutory federal and state rate of 25.7% from our estimate in 2021 of 24.2%. During the first three months of 2022 or 2021, we were not required to make any payments of estimated federal or state income taxes.