Income Taxes

6 Months Ended

Jul. 02, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Note N — Income Taxes

Our effective tax rate (income taxes as a percentage of income from continuing operations before income taxes) was 29.0 percent for the quarter ended July 2, 2021 compared with 17.3 percent for the quarter ended July 3, 2020. During the quarter ended July 2, 2021, our effective tax rate was unfavorably impacted by non-deductible goodwill from completed business divestitures and the unfavorable impact of valuation allowances in certain foreign jurisdictions, partially offset by the favorable impact of research and development (“R&D”) credits, favorable resolution of specific audit uncertainties and the favorable impact of excess tax benefits related to equity-based compensation. During the quarter ended July 3, 2020, our effective tax rate benefited from the favorable impact of R&D credits and the favorable impact of a net reduction in our uncertain tax position balance, partially offset by the unfavorable impact of non-deductible goodwill impairment charges.

Our effective tax rate was 20.6 percent for the two quarters ended July 2, 2021 compared with 15.1 percent for the two quarters ended July 3, 2020. Our effective tax rate for the two quarters ended July 2, 2021 was impacted by the items described above for the quarter ended July 2, 2021. In addition to the items noted above for the quarter ended July 3, 2020, our effective tax rate for the two quarters ended July 3, 2020 benefited from the favorable impact of excess tax benefits related to equity-based compensation.