Income Taxes

12 Months Ended

Apr. 01, 2023

Income Tax Disclosure [Abstract]

Income Taxes

10.Income Taxes

Pretax income for the fiscal years ended April 1, 2023, April 2, 2022, and April 3, 2021 was attributable to the following tax jurisdictions:

	Year Ended
(Dollars in thousands)	April 1, 2023		April 2, 2022		April 3, 2021
Domestic	$	499,715	$	300,675	$	92,832
Foreign		34,181		29,754		18,568
Income before income taxes	$	533,896	$	330,429	$	111,400

The income tax provision by jurisdiction for the fiscal years ended April 1, 2023, April 2, 2022, and April 3, 2021 was as follows:

	Year Ended
(Dollars in thousands)	April 1, 2023			April 2, 2022			April 3, 2021
Current:
U.S. federal	$	98,242		$	55,983		$	13,094
Foreign		8,560			7,907			4,738
State		24,000			15,476			5,081
Total current	$	130,802		$	79,366		$	22,913
Deferred
U.S. federal	$	78		$	2,367		$	2,853
Foreign		1,440			1,118			851
State		(226	)		(466	)		(116	)
Total deferred	$	1,292		$	3,019		$	3,588
Total income tax expense	$	132,094		$	82,385		$	26,501

Income tax expense differs from the amount of income tax determined by applying the applicable U.S. statutory federal income tax rate to income before income taxes as a result of the following differences:

	Year Ended
(Dollars in thousands)	April 1, 2023			April 2, 2022			April 3, 2021
Tax expense at U.S federal statutory rate	$	112,118		$	69,390		$	23,394
Increase (decrease) in rate resulting from:
State taxes, net of U.S. federal benefit	$	18,956		$	11,908		$	3,969
Foreign tax rate differences		1,566			1,417			900
Recognition of foreign investment basis difference		1,249			1,076			616
Change in deferred tax valuation allowance		(703	)		189			1,343
U.S. tax credits		(2,694	)		(2,296	)		(3,096	)
Other		1,602			701			(625	)
Total income tax expense	$	132,094		$	82,385		$	26,501

The U.S. income tax rate for fiscal 2023, 2022, and 2021 was 21%.

Deferred tax assets and liabilities at April 1, 2023 and April 2, 2022 consisted of the following:

(Dollars in thousands)	April 1, 2023			April 2, 2022
ASSETS
Warranty reserves	$	8,889		$	8,043
Intangible assets		8,763			9,833
Lease assets		7,487			2,774
Employee compensation		7,320			12,042
Foreign net operating loss carryforwards		6,343			6,470
Self-insurance reserves		5,851			5,396
Equity-based compensation		3,258			2,206
Dealer volume discounts		2,749			2,077
Inventory reserves and impairments		2,599			1,750
Other		3,987			6,032
Gross deferred tax assets	$	57,246		$	56,623
LIABILITIES
Property, plant, and equipment	$	13,367		$	9,901
Lease liabilities		7,487			2,774
Intangible assets		5,974			7,834
Foreign tax basis difference in investments		5,964			5,124
Other		958			5,623
Gross deferred tax liabilities		33,750			31,256
Valuation allowance		(12,038	)		(12,741	)
Net deferred tax assets	$	11,458		$	12,626

The Company anticipates periodically repatriating the earnings of its Netherlands and Canadian subsidiaries. A deferred tax liability is recognized for income tax withholding which may be incurred upon the reversal of basis differences in investments in its foreign subsidiaries.

The Company periodically evaluates the realizability of its deferred tax assets based on whether it is “more likely than not” that some portion of the deferred tax assets will not be realized. Our evaluation considers available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets. The Company’s valuation allowance principally consists of valuation allowances for certain state NOL carryforwards, certain Canadian deferred tax assets, and the Company’s deferred tax assets in the Netherlands.

As of April 1, 2023, the Company has state NOL carryforwards in various jurisdictions which expire primarily in 2023 through 2042.

Unrecognized tax benefits represent the differences between tax positions taken or expected to be taken on a tax return and the benefits recognized for financial statement purposes. There were no unrecognized tax benefits at April 1, 2023 and April 2, 2022.

The Company is no longer subject to foreign tax examinations by tax authorities for years prior to fiscal 2019. The Company’s U.S. subsidiaries are subject to U.S. federal tax examinations for fiscal 2020 through fiscal 2023, and U.S. state tax examinations by tax authorities for fiscal 2019 through fiscal 2023.