Income Taxes

6 Months Ended

Jun. 25, 2022

Income Tax Disclosure [Abstract]

Income Taxes

J. Income Taxes

The following table provides a summary of the income tax provision for the thirteen and twenty-six weeks ended June 25, 2022 and June 26, 2021:

	Thirteen weeks ended
	June 25, 2022			June 26, 2021
	(in thousands)
Summary of income tax provision
Tax provision based on net income	$	18,469		$	21,315
Benefit of ASU 2016-09		(951	)		(426	)
Total income tax provision	$	17,518		$	20,889
	Twenty-six weeks ended
	June 25, 2022			June 26, 2021
	(in thousands)
Summary of income tax provision
Tax provision based on net income	$	17,834		$	40,927
Benefit of ASU 2016-09		(648	)		(9,040	)
Total income tax provision	$	17,186		$	31,887

The tax benefit of ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, was $1.0 million and $0.6 million for the thirteen and twenty-six weeks ended June 25, 2022, respectively, as compared to $0.4 million and $9.0 million for the thirteen and twenty-six weeks ended June 26, 2021, respectively, primarily due to changes in the stock price and the number of shares exercised.

The Company’s effective tax rate, excluding the impact of ASU 2016-09, for the thirteen weeks and twenty-six weeks ended June 25, 2022 was 26.1% and 26.0%, respectively, compared to 26.6% and 26.1% for the thirteen and twenty-six weeks ended June 26, 2021, respectively, primarily due to a decrease in non-deductible officer compensation.

As of June 25, 2022 and December 25, 2021, the Company had approximately $0.2 million and $0.2 million, respectively, of unrecognized income tax benefits.

The Company’s practice is to classify interest and penalties related to income tax matters in income tax expense. As of June 25, 2022 and December 25, 2021, the Company had $0.2 million and $0.2 million, respectively, accrued for interest and penalties recorded in other liabilities.

The Internal Revenue Service completed an examination of the 2015 consolidated corporate income tax return and issued a no change report in 2018. The Company’s state income tax returns remain subject to examination for three or four years depending on the state’s statute of limitations. The Company is not currently under any income tax audits as of June 25, 2022.