Income Taxes

6 Months Ended

Jul. 16, 2022

Income Tax Disclosure [Abstract]

Income Taxes

Note 9 – Income Taxes

The effective income tax rate was 29.0% and 25.8% for the 12 weeks ended July 16, 2022 and July 17, 2021, respectively. The effective income tax rate was 22.2% and 25.1% for the 28 weeks ended July 16, 2022 and July 17, 2021, respectively. The difference from the federal statutory rate in current quarter was primarily due to state taxes and non-deductible expenses, partially offset by tax benefits associated with federal tax credits. The difference in the federal statutory rate in the current year was primarily due to state taxes and non-deductible expenses, partially offset by tax benefits associated with federal tax credits and discrete tax benefits related to stock compensation. In the prior year, the difference from the federal statutory rate was primarily due to state taxes, partially offset by federal tax credits.

On March 27, 2020, the U.S. government enacted tax legislation to provide economic stimulus and support businesses and individuals during the COVID-19 pandemic, referred to as the CARES Act. In connection with the CARES Act, the Company recorded net discrete income tax benefits of $9.3 million in 2020 associated with the additional deductibility of certain expenses combined with provisions which enable companies to carry back tax losses to years prior to the enactment of the Tax Cuts and Jobs Act (“Tax Reform”), when the federal statutory income tax rate was 35%. In the first quarter of 2021, the Company received tax refunds totaling $25.7 million related to the amended prior year returns.