Income Taxes

12 Months Ended

Apr. 03, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The provision for income taxes generally represents income taxes paid or payable for the current year plus the change in deferred taxes during the year. The following details the provision for income taxes for fiscal years 2021, 2020 and 2019 (in thousands):

	Fiscal Year
	2021		2020		2019
Current
Federal	$	16,823	$	14,625	$	16,086
State	3,128		3,084		2,209
	19,951		17,709		18,295
Deferred
Federal	302		246		(347)
State	13		(42)		106
	315		204		(241)
	$	20,266	$	17,913	$	18,054

A reconciliation of income taxes computed by applying the expected federal statutory income tax rate of 21% for fiscal years 2021, 2020 and 2019 to income before income taxes reported in the Consolidated Statements of Comprehensive Income is as follows (in thousands):

	Fiscal Year
	2021		2020		2019
Federal income tax at statutory rate	$	20,351	$	19,525	$	18,202
State income taxes, net of federal benefit	3,422		3,297		3,111
Stock-based compensation	(2,710)		(2,994)		(2,507)
Tax credits	(1,356)		(2,401)		(1,506)
Other	559		486		754
	$	20,266	$	17,913	$	18,054

Net deferred tax assets and liabilities were as follows (in thousands):

	April 3, 2021		March 28, 2020
Net deferred tax (liabilities) assets
Goodwill	$	(16,327)	$	(16,120)
Property, plant, equipment and depreciation	(5,121)		(5,084)
Warranty reserves	4,277		4,444
Lease - Operating lease liability	4,123		3,535
Lease - Right of use asset	(3,820)		(3,295)
Salaries and wages	3,065		1,679
Stock-based compensation	2,177		2,595
Unrealized gains on marketable equity investments	(1,695)		(43)
Loan discount	1,631		2,436
Other intangibles	(1,538)		(1,534)
Accrued volume rebates	1,494		1,189
Inventory	1,271		1,012
Other	3,070		1,891
	$	(7,393)	$	(7,295)

The effective income tax rate for the current year was positively impacted by stock option exercises and the recognition of certain tax credits, including Energy Star, Research and Development and Work Opportunity Tax Credits.

We recorded an insignificant amount of unrecognized tax benefits during fiscal years 2021, 2020 and 2019, and there would be an insignificant effect on the effective tax rate if all unrecognized tax benefits were recognized. We classify interest and penalties related to unrecognized tax benefits in income tax expense. The total amount of unrecognized tax benefit related to any particular tax position is not anticipated to change significantly within the next 12 months. We believe that our income tax filing positions and deductions will be sustained on audit and we do not anticipate any adjustments that will result in a material change to our financial position.

We periodically evaluate the deferred tax assets based on the requirements established in ASC 740, which requires the recording of a valuation allowance when it is more likely than not that some portion or all of the deferred tax assets will not be realized. The determination of the need for, or amount of, any valuation allowance involves significant management judgment and is based upon the evaluation of both positive and negative evidence, including management projections of anticipated taxable income. At April 3, 2021, we had state net operating loss carryforwards that total $12.6 million, which begin to expire in 2025. We recorded a $445,000 valuation allowance against the related deferred tax asset. At April 3, 2021, we evaluated our historical profits earned and forecasted taxable income and determined that, except as described above, all of the deferred tax assets would be utilized in future periods. Ultimate realization of the deferred tax assets depends on our ability to continue to earn profits, as we have historically, and to meet these forecasts in future periods.

Income tax returns are filed in the U.S. federal jurisdiction and in several state jurisdictions. In general, we are no longer subject to examination by the IRS for years before fiscal year 2018 or state and local income tax examinations by tax authorities for years before fiscal year 2017.