Income Taxes |
6 Months Ended |
|---|---|
Jun. 28, 2025 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | Income Taxes We are taxed as a Corporation under Subchapter C in the U.S. We also file in U.S. state and local jurisdictions and in other countries where we have operations. Our effective tax rate is based on pre-tax earnings, enacted U.S. statutory tax rates, non-deductible expenses, and certain tax rate differences between U.S. and foreign jurisdictions. The foreign subsidiaries file income tax returns in local country jurisdictions as required. The U.K., France, and Australia entities are included on U.S. tax returns as pass-through entities.
We account for income taxes in accordance with FASB ASC 740, “Income Taxes” (“ASC 740”). We determine our provision for income taxes for interim periods using an estimate of our annual effective tax rate on year-to-date ordinary income and records any changes affecting the estimated annual effective tax rate in the interim period in which the changes occur. Our provision for income taxes consists of provisions for federal, state, and foreign income taxes. Deferred tax liabilities and assets attributable to different tax jurisdictions are not offset in the unaudited condensed consolidated financial statements.
During the three month periods ended June 28, 2025 and June 29, 2024, we recorded a total income tax provision of approximately $6.4 and $9.5 on pre-tax income of $27.1 and $37.1 resulting in an effective tax rate of 23.6% and 25.6%, respectively. During the six month periods ended June 28, 2025 and June 29, 2024, we recorded a total income tax provision of approximately $11.0 and $20.0 on pre-tax income of $42.5 and $78.3 resulting in an effective tax rate of 25.9% and 25.5%, respectively. For the three and six month periods ended June 28, 2025, the effective tax rate was primarily impacted by state income taxes, nondeductible executive compensation, the discrete impact of RSU vesting, offset by the benefit of the federal and state income tax credits and the U.S. tax benefit derived from U.S. exports. For the three and six month periods ended June 29, 2024, effective tax rates were primarily impacted by statutory rate differentials, changes in estimated state income tax and apportionment rates, and permanent differences.
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework, and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. We are currently assessing its impact on our unaudited consolidated financial statements.
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