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Income Taxes
 12 Months Ended
Dec. 30, 2023
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Income tax expense (benefit) consisted of the following (in thousands):
202320222021
Current:
Federal$5,474 $15,518 $17,019 
State3,106 5,174 4,568 
8,580 20,692 21,587 
Deferred:
Federal(10,151)(7,264)10,954 
State(2,895)(1,143)1,004 
(13,046)(8,407)11,958 
Income tax (benefit) expense
$(4,466)$12,285 $33,545 
The following table provides a reconciliation between the statutory federal income tax rate and the Company’s effective income tax rate:
202320222021
Statutory federal income tax21.0 %21.0 %21.0 %
State income taxes, net of federal benefit(3.5)6.4 3.0 
R&D tax credits14.1 (5.5)(1.4)
Return to provision
6.1 0.8 0.1 
Investment tax credit
1.1 — — 
Stock-based compensation(6.2)(1.2)(6.3)
Non-deductible compensation(5.7)1.7 1.5 
Non-deductible expenses
(2.8)1.3 0.3 
Changes in unrecognized tax benefits(0.5)(0.4)(0.1)
Other(1.0)1.0 (0.2)
Effective income tax rate22.6 %25.1 %17.9 %

The Company files income tax returns with the U.S. federal government and various state jurisdictions. In the normal course of business, the Company is subject to examination by federal and state taxing authorities. The Company is no longer subject to federal income tax examinations for years prior to 2020 or state income tax examinations prior to 2019.

Deferred Income Taxes

The tax effects of temporary differences that give rise to deferred income taxes were as follows (in thousands):
20232022
Deferred tax assets:
Stock-based compensation$7,006 $6,896 
Operating lease liabilities108,952 109,144 
Warranty and returns liabilities6,894 7,881 
Net operating loss carryforwards and credits1,738 2,051 
Compensation and benefits7,484 7,678 
Research and development18,079 13,860 
Other8,931 6,110 
Total gross deferred tax assets159,084 153,620 
Valuation allowance(48)(615)
Total gross deferred tax assets after valuation allowance159,036 153,005 
Deferred tax liabilities:
Property and equipment33,772 38,442 
Operating lease right-of-use assets99,351 99,311 
Deferred revenue3,065 4,394 
Other2,595 2,900 
Total gross deferred tax liabilities138,783 145,047 
Net deferred tax assets
$20,253 $7,958 

At December 30, 2023, the Company had net operating loss carryforwards for federal purposes of $0.4 million, which will expire between 2025 and 2027.
The Company evaluates its deferred income taxes quarterly to determine if valuation allowances are required. As part of this evaluation, the Company assess whether valuation allowances should be established for any deferred tax assets that are not considered more likely than not to be realized, using all available evidence, both positive and negative. This assessment considers, among other matters, the nature, frequency, and severity of historical losses, forecasts of future profitability, taxable income in available carryback periods and tax planning strategies. In making such judgments, significant weight is given to evidence that can be objectively verified. The Company has provided a $48 thousand valuation allowance resulting primarily from its inability to utilize certain net operating losses.

Unrecognized Tax Benefits

Reconciliations of the beginning and ending amounts of unrecognized tax benefits were as follows (in thousands):
Federal and State Tax
202320222021
Beginning balance$3,645 $3,869 $3,912 
Increases related to current-year tax positions753 910 831 
Increases related to prior-year tax positions40 252 4 
Decreases related to prior-year tax positions— (328)(33)
Lapse of statute of limitations(601)(1,058)(845)
Settlements with taxing authorities(166)— — 
Ending balance$3,671 $3,645 $3,869 

At December 30, 2023 and December 31, 2022, the Company had $3.4 million and $3.2 million, respectively, of unrecognized tax benefits, which if recognized, would affect its effective tax rate. The amount of unrecognized tax benefits is not expected to change materially within the next 12 months.