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Income Taxes
6 Months Ended
Jun. 25, 2019
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes
The effective income tax rate for the 13 weeks ended June 25, 2019 was 29.3%, compared to 61.1% for the 13 weeks ended June 26, 2018. The effective income tax rate for the 26 weeks ended June 25, 2019 was 13.5%, compared to 61.1% for the 26 weeks ended June 26, 2018. For the 26 weeks ended June 25, 2019, the factors that cause the effective tax rates to vary from the federal statutory rate of 21% were primarily the change to the valuation allowance, the effect of certain permanent differences and the impact of the FICA tip deduction addback. For the 26 weeks ended June 26, 2018, the factors causing the effective tax rates to vary from the federal statutory rate of 21% include the impact of the FICA tip and other credits, partially offset by state income taxes and certain non-deductible expenses.
The Company assesses the available positive and negative evidence at each balance sheet date to determine whether sufficient future taxable income will be generated to permit the use of existing deferred tax assets. The purpose of this analysis is to assess whether it is more likely than not that some or all of our deferred tax assets will not be realized. Significant judgment is required in estimating valuation allowances for deferred tax assets and in making this determination, we consider all available positive and negative evidence and make certain assumptions. The realization of a deferred tax asset ultimately depends on the existence of sufficient taxable income in the applicable carryback or carryforward periods. To the extent we generate sufficient taxable income in the future to fully utilize the tax benefits of the net deferred tax assets on which a valuation allowance was recorded; our effective tax rate may decrease as the valuation allowance is reversed. During fiscal 2018, the Company entered a three year cumulative loss position and established a valuation allowance against deferred tax assets for which it is more likely than not that the deferred tax assets will not be realized.