Income Taxes

6 Months Ended

Jul. 29, 2023

Income Tax Disclosure [Abstract]

Income Taxes

ncome Taxes

The provision for income taxes is based on the current estimate of the annual effective tax rate and is adjusted as necessary for quarterly events.

For the second quarter of 2023, the Company’s effective tax rate was 144.2% compared to 19.2% in the second quarter of 2022. The second quarter of 2023 rate differed from the Company's combined estimated federal and state statutory rate primarily due to non-deductible liabilities related to contingent consideration and Contingent Compensation Payments. The second quarter of 2022 rate was lower than the Company's combined estimated federal and state statutory rate primarily due to foreign earnings taxed at a rate lower than our combined statutory rate.

For year-to-date 2023, the Company’s effective tax rate was 62.0% compared to 11.1% for year-to-date 2022. The year-to-date 2023 rate differed from the Company's combined estimated federal and state statutory rate primarily due to non-deductible liabilities related to contingent consideration and Contingent Compensation Payments. The year-to-date 2022 rate was lower than the Company's combined estimated federal and state statutory rate primarily due to the recognition of excess tax benefits related to share-based compensation awards that vested in the respective period.

The Company paid income taxes in the amount of $43 million and $130 million for the second quarter of 2023 and 2022, respectively. Year-to-date income taxes paid were $59 million and $140 million for 2023 and 2022, respectively.