Income Taxes

9 Months Ended

Oct. 03, 2021

Income Taxes [Abstract]

Income Taxes

Note 6.  Income Taxes

Provision for taxes was $8.9 million and $27.6 million during the three-month and nine-month periods ended October 3, 2021, respectively.  Provision for taxes was $7.0 million and $17.6 million for the three-month and nine-month periods ended September 27, 2020. The effective tax rate was 17.6% for the three months ended October 3, 2021 as compared with 19.6% for the three months ended September 27, 2020.  The lower tax rate was primarily due to a greater depletion benefit on higher sales as compared to the prior year.

As of October 3, 2021, the Company had approximately $7.2 million of total unrecognized income tax benefits. Included in this amount were a total of $4.6 million of unrecognized income tax benefits that, if recognized, would affect the Company’s effective tax rate.  While it is expected that the amount of unrecognized tax benefits will change in the next 12 months, the Company does not expect the change to have a significant impact on the results of operations or the financial position of the Company.

The Company’s accounting policy is to recognize interest and penalties accrued relating to unrecognized income tax benefits as part of its provision for income taxes.  The Company had a net increase of approximately $0.1 million during the three-month period ended October 3, 2021 and no change during the nine-month period ended October 3, 2021 and an accrued balance of $2.0 million of interest and penalties as of October 3, 2021.

The Company operates in multiple taxing jurisdictions, both within and outside the U.S.  In certain situations, a taxing authority may challenge positions that the Company has adopted in its income tax filings.  The Company, with a few exceptions (none of which are material), is no longer subject to income tax examinations by tax authorities for years prior to 2010.