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INCOME TAX EXPENSE | 6 Months Ended
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Dec. 29, 2019
Income Tax Disclosure [Abstract] |
INCOME TAX EXPENSE | INCOME TAX EXPENSE The Company recorded an income tax expense of $158.1 million and $217.0 million for the three and six months ended December 29, 2019, which yielded an effective tax rate of approximately 23.5% and 18.1%, respectively. The difference between the U.S. federal statutory tax rate of 21% and the Company’s effective tax rate for the three months ended December 29, 2019 was primarily due to income in lower tax jurisdictions, U.S. taxation on low-taxed foreign income, and a cumulative income tax benefit reversal due to a court ruling, as outlined below. In November 2019, the U.S. Court of Appeals for the Ninth Circuit (“Ninth Circuit”) rejected the en banc appeal petitioned by Altera Corporation (“Altera”) in July 2019. The Company has evaluated the impact of this decision and views the denial as an indication that Altera’s position of excluding stock-based compensation expense in an inter-company cost-sharing arrangement is unlikely to be sustained upon further litigation. As a result, the Company has reversed $74.5 million of net tax assets associated with stock-based compensation benefits related to previous years in the Condensed Consolidated Financial Statements in the three months ended December 29, 2019. In conclusion, the Company is no longer reflecting a net tax benefit within its financial statements related to excluding stock-based compensation from its inter-company cost-sharing arrangement. If, at a future date, Altera secured a favorable ruling from the Supreme Court, the Company would re-evaluate the decision to record an income tax benefit at that time. Please refer to Note 7, “Income Taxes,” to the Company’s Consolidated Financial Statements in Part II, Item 8 of its 2019 Form 10-K for additional information. The Internal Revenue Service (“IRS”) is examining the Company’s U.S. federal income tax return for the fiscal year ended June 24, 2018. As of December 29, 2019, no significant adjustments have been proposed by the IRS. The Company is unable to make a reasonable estimate as to when cash settlements, if any, with the IRS will occur. The Company is in various stages of examinations in connection with all of its tax audits worldwide, and it is difficult to determine when these examinations will be settled. It is reasonably possible that over the next 12-month period the Company may experience an increase or decrease in its unrecognized tax benefits as a result of tax examinations or lapses of statute of limitations. The change in unrecognized tax benefits may range up to $10.0 million.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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