10. Income Taxes

Our provision for income taxes is based on estimated effective tax rates derived from an estimate of annual consolidated earnings before taxes, adjusted for nondeductible expenses, other permanent items and any applicable credits.

The following table presents the provision for income taxes (in thousands) and the effective tax rates:



	Three Months Ended				Nine Months Ended
	December 26,		December 27,		December 26,		December 27,
	2015		2014		2015		2014
Income before income taxes	$	62,395	$	42,261	$	154,876	$	61,619
Provision for income taxes	$	21,011	$	19,532	$	45,258	$	27,790
Effective tax rate		33.7%		46.2%		29.2%		45.1%

Our income tax expense for the third quarter and first nine months of fiscal year 2016 was below the federal statutory rate primarily due to the permanent extension of the U.S. R&D credit by the Consolidated Appropriations Act, 2016, which was enacted on December 18, 2015. Income tax expense for the first nine months of fiscal year 2016 was further reduced by a one-time tax benefit of $4.6 million associated with deferred taxes related to U.S. R&D credit carry forwards recorded in the second quarter of fiscal year 2016. Our income tax expense for the third quarter and first nine months of fiscal year 2015 was above the federal statutory rate primarily due to the inclusion of foreign losses in the period from the close of the Acquisition to the end of the period at foreign statutory rates below the U.S. federal statutory rate, which was partially offset by the extension of the U.S. R&D credit through December 31, 2014 by the Tax Increase Prevention Act of 2014, which was enacted on December 19, 2014.

We record unrecognized tax benefits for the estimated risk associated with tax positions taken on tax returns. As of December 26, 2015, the Company had unrecognized tax benefits of $13.8 million, all of which would affect the effective tax rate if recognized. The Company’s total unrecognized tax benefits are classified as “Other long-term liabilities” in the consolidated condensed balance sheets. We recognize interest and penalties related to unrecognized tax benefits in the provision for income taxes. As of December 26, 2015, the balance of accrued interest and penalties was zero. No interest or penalties were incurred during the first nine months of fiscal year 2016 or 2015.

The Company and its subsidiaries are subject to U.S. federal income tax as well as income tax in multiple state and foreign jurisdictions. Fiscal years 2013 through 2015 remain open to examination by the major taxing jurisdictions to which we are subject, although carry forward attributes that were generated in tax years prior to fiscal year 2013 may be adjusted upon examination by the tax authorities if they have been, or will be, used in a future period. The Company is not currently under an income tax audit in any major taxing jurisdiction.