INCOME TAXES

9 Months Ended

Oct. 01, 2022

INCOME TAXES

INCOME TAXES

11. INCOME TAXES

The effective income tax rate for the fiscal quarter and three fiscal quarters ended October 1, 2022 was 43.4% and 65.6%, respectively, compared to (223.8)% and (39.3)% for the fiscal quarter and three fiscal quarters ended October 2, 2021. The difference between the U.S. federal statutory income tax rate and the Company’s effective income tax rate for both the fiscal quarter and three fiscal quarters ended October 1, 2022 was primarily attributable to the discrete impact of stock-based compensation expense for which there is no associated tax benefit. The difference between the U.S. federal statutory income tax rate and the Company’s effective income tax rate for both the fiscal quarter and three fiscal quarters ended October 2, 2021 was also primarily attributable to the discrete impact of stock-based compensation expense.

The Inflation Reduction Act ("IRA") was passed into law on August 16, 2022. Key provisions from the IRA include the implementation of a 15% corporate alternative minimum tax, an excise tax on stock buybacks, and significant tax incentives for energy and climate initiatives. Enactment of the IRA has not impacted the Company’s financial condition, results of operations or cash flows for the period ended October 1, 2022 and the Company does not expect a material impact on its future results.