Income Taxes |
3 Months Ended |
|---|---|
Mar. 30, 2019 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes |
Accounting Standards Codification 740 (“ASC 740”) requires companies to apply their estimated annual effective tax rate on a year-to-date basis in each interim period. These rates are derived, in part, from expected annual pre-tax income or loss. In the thirteen weeks ended March 30, 2019 and the thirteen weeks ended March 31, 2018, the Company applied an estimated annual effective tax rate to the interim period pre-tax loss to calculate the income tax expense.
For the thirteen weeks ended March 30, 2019, the effective income tax rate was (15.8)%. The Company recorded income tax expense for the thirteen weeks ended March 30, 2019 of $4,800. The negative effective tax rate for the thirteen weeks ended March 30, 2019 was the result of the Global Intangible Low-Taxed Income ("GILTI") and the IRC Section 163(j) interest limitation. Consistent with prior year, the primary impact of the effective tax rate differential for the thirteen weeks ended March 30, 2019 was due to the Company recording a valuation allowance on its interest limitation. In addition, the effective income tax rate differed from the federal statutory tax rate for the thirteen weeks ended March 30, 2019 due to certain non-deductible expenses and state and foreign income taxes.
The effective income tax rate was (37.4)% for the thirteen weeks ended March 31, 2018. The Company recorded income tax expense for the thirteen weeks ended March 31, 2018 of $2,806. The negative effective income tax rate for the thirteen weeks ended March 31, 2018 was primarily the result of the new provisions introduced by the Tax Cuts and Jobs Act (the "Tax Act"). The effective income tax rate differed from the federal statutory rate in the thirteen weeks ended March 31, 2018 due to recognizing no benefit on losses in jurisdictions where valuation allowances are recorded against net deferred tax assets, certain non-deductible expenses, and several aspects of the Tax Act including the new provision on Global Intangible Low-Taxed Income ("GILTI") and the IRC Section 163(j) interest limitation.
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