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Income Taxes | 9 Months Ended
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Feb. 28, 2019
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes In the normal course of business, Cintas provides for uncertain tax positions and the related interest and adjusts its unrecognized tax benefits and accrued interest accordingly. As of February 28, 2019 and May 31, 2018, recorded unrecognized tax benefits were $31.5 million and $26.9 million, respectively, and are included in long-term accrued liabilities on the consolidated condensed balance sheet. The majority of Cintas' operations are in North America. Cintas is required to file federal income tax returns, as well as state income tax returns in a majority of the domestic states and also in certain Canadian provinces. At times, Cintas is subject to audits in these jurisdictions. The audits, by nature, are sometimes complex and can require several years to resolve. The final resolution of any such tax audit could result in either a reduction in Cintas' accruals or an increase in its income tax provision, either of which could have an impact on the consolidated condensed results of operations in any given period. All U.S. federal income tax returns are closed to audit through fiscal 2015. Cintas is currently in various audits in certain foreign jurisdictions and certain domestic states. The years under foreign and domestic state audits cover fiscal years back to 2013. Based on the resolution of the various audits and other potential regulatory developments, it is reasonably possible that the balance of unrecognized tax benefits would not change for the fiscal year ending May 31, 2019. On December 22, 2017, the President signed into legislation the Tax Act. Among other changes, the Tax Act reduced the U.S. corporate tax rate from 35% to 21% and required companies to pay a one-time transition tax on earnings of foreign subsidiaries. The Tax Act also included provisions that were expected to offset some of the benefit of the U.S. corporate tax rate reduction, including the repeal of the deduction for domestic production activities and the expansion of the limitation on the deduction of certain executive compensation. In addition, the Tax Act altered the landscape of taxation of non-U.S. operations and provided immediate deductions for certain new investments, among other provisions. In acknowledgment of the substantial changes incorporated in the Tax Act, and with the timing of the enactment being just weeks before the majority of the provisions became effective, the SEC staff issued Staff Accounting Bulletin (SAB) 118 to provide certain guidance in determining the accounting for income tax effects of the legislation in the accounting period of enactment as well as provide a measurement period within which to finalize and reflect such final effects associated with the Tax Act. As of February 28, 2019, Cintas has completed the accounting for the tax effects of the Tax Act. In fiscal 2018, Cintas recorded the provisional transition tax liability, net of foreign tax credits of $9.8 million on the mandatory deemed repatriation of foreign earnings. During the first quarter of fiscal 2019, Cintas increased the provisional transition tax liability, net of foreign tax credits, by $3.3 million to $13.1 million due to changes in estimates. In the third quarter of fiscal 2019, Cintas finalized the transition tax liability, net of foreign tax credits, and reduced the provisional estimate by $3.1 million to $9.9 million. In addition, the adjustment to the provisional amount related to the remeasurement of certain deferred tax assets and liabilities resulted in an additional expense of $0.4 million. Cintas also analyzed the impact of the provisions under the Tax Act surrounding executive compensation, the foreign derived intangible income deduction and global intangible low-taxed income and determined that the impact was immaterial for the three and nine months ended February 28, 2019. Cintas’ effective tax rate for continuing operations was 20.1% and (69.5)% for the three months ended February 28, 2019 and 2018, respectively. For the nine months ended February 28, 2019 and 2018, Cintas' effective tax rate for continuing operations was 19.3% and 0.9%, respectively. All periods were impacted by certain discrete items (primarily the tax accounting for stock-based compensation). The three and nine-month periods ended February 28, 2018 were also largely impacted by the revaluation of deferred tax assets and liabilities as a result of the Tax Act.

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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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