Income Taxes

9 Months Ended

Sep. 26, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company’s provision for income tax expense (benefits) was approximately $1.5 million and $6.7 million and its effective income tax rates were 5.1% and 10.9% for the three months and nine months period ended September 26, 2021, respectively. The Company’s provision for income tax expense (benefits) were approximately $4.2 million, and $(1.6) million and its effective income tax rates were 21.0% and (4.2)% for the three months and nine months periods ended September 27, 2020, respectively.

The provision for income taxes for the period ended September 26, 2021 differed from the U.S. federal statutory rate computed by applying the U.S. federal statutory rate to income or loss before income taxes primarily due to the benefit of Foreign Derived Intangible Income (“FDII”), nontaxable income including the fair value adjustment for warrants, offset by the effect of foreign operations. The provision for income taxes for the period ended September 27, 2020 differed from the U.S. federal statutory rate computed by applying the U.S. federal statutory rate to income or loss before income taxes primarily due to the benefit of FDII, increased prior year interest expense deduction under the Coronavirus Aid, Relief and Economic Security Act (as amended, the “CARES Act”) adjustments, nontaxable income including the fair value adjustment for warrants, and settlement of foreign taxes, offset by disallowed compensation deduction under Internal Revenue Code Section 162(m) and disallowed transaction costs.

On March 27, 2020, the CARES Act was signed into law. Under the CARES Act, the Company deferred $37.0 million of employer share of Social Security tax that will be paid equally by December 31, 2021 and 2022.