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Income Taxes (Notes)
9 Months Ended
Dec. 29, 2018
Income Tax Disclosure [Abstract]  
Income Tax Disclosure [Text Block]
17. Income Taxes
The Tax Cuts and Jobs Act (the Tax Act) was enacted into law in the United States on December 22, 2017. The Tax Act includes various changes to the tax law, including a reduction in the U.S. corporate income tax rate from 35% to 21%.
The Tax Act added section 250 to the Internal Revenue Code, effectively creating a new preferential tax rate for income derived by domestic corporations from serving foreign markets. The new deduction is described as a deduction for foreign-derived intangible income. This lower tax rate provides a new benefit for owning intangible property and conducting business operations in the United States.
The Tax Act also includes a base erosion and anti-abuse tax (BEAT), applicable to corporations with annual gross receipts of at least $500 million for the prior 3-years, which requires U.S. multinationals making “excessive” deductible payments to their foreign affiliates to pay a 10 percent tax on their income without those deductions, after a one-year, 5 percent transition rate. The Company does not expect the BEAT provisions to apply until it meets the threshold. Further the Tax Act imposes a tax on global intangible low-taxed income (GILTI) on controlled foreign corporations’ aggregate net income over a 10% benchmark return on qualified business asset investment less interest expense. The Company continues to assess the impacts of these provisions on the Company’s financial position, results of operations or cash flows.
The Securities and Exchange Commission Staff Accounting Bulletin No. 118 (SAB 118) allows the use of provisional amounts in the Company’s financial statements during a measurement period if accounting for the income tax effects of the Tax Act has not been completed when the Company’s financial statements are issued. This measurement period may extend no longer than one year. The Company has evaluated the new legislation and the additional technical guidance from the Department of Treasury, the FASB, and other relevant rule-making bodies issued to date and updated our financial position, results of operations, and cash flows based upon the available information. As a result of evaluating the new rules and regulations relating Internal Revenue Code (IRC) §965 regarding the deemed repatriation of foreign earnings and how it impacts the Company, the Company made the basis election under Prop. Reg. Section 1.965-2(f)(2), allowing the Company to make certain basis adjustments with respect to the stock of each deferred foreign income corporation and each earnings and profits deficit foreign corporation. The change resulted in the recognition of capital gain for which there was sufficient excess capital loss carried forward to fully offset the gain. Furthermore, the valuation allowance recorded against the excess capital loss carry carry-forward was reversed. As a result the financial arising from the change was minimal.