Income Taxes

9 Months Ended

Feb. 29, 2012

Income Taxes

Income Taxes

7.Income Taxes

In the normal course of business, Cintas provides for uncertain tax positions and the related interest and adjusts its unrecognized tax benefits and accrued interest accordingly.  During the three months ended February 29, 2012, unrecognized tax benefits increased by approximately $0.1 million and accrued interest increased by approximately $0.6 million.  During the nine months ended February 29, 2012, unrecognized tax benefits increased by approximately $0.1 million and accrued interest increased by approximately $2.2 million.

All U.S. federal income tax returns are closed to audit through fiscal 2008.  Cintas is currently in advanced stages of audits in certain foreign jurisdictions and certain domestic states. The years under audit cover fiscal years back to 2004.  Based on the resolution of the various audits, it is reasonably possible that the balance of unrecognized tax benefits could decrease by $12.8 million for the fiscal year ending May 31, 2012.

On December 23, 2011, the U.S. Department of the Treasury and the Internal Revenue Service issued temporary regulations (Regulations Section 2011-14) that provide guidance on amounts paid to improve tangible property.  These regulations also provide guidance on amounts paid to acquire or produce tangible property, as well as guidance regarding the disposition of property.  Cintas is currently reviewing these regulations to determine the effect, if any, on Cintas’ consolidated financial statements.