The Company’s income tax provision (benefit) consists of the following:


	Fiscal Year Ended
	December 31, 2022			December 25, 2021			December 26, 2020
U.S. federal:
Current	$	45,639		$	(13,096	)	$	(25,220	)
Deferred		(149,734	)		(42,625	)		(7,115	)
	$	(104,095	)	$	(55,721	)	$	(32,335	)
U.S. state:
Current	$	12,870		$	(5,876	)	$	(3,931	)
Deferred		(29,160	)		(8,132	)		2,715
	$	(16,290	)	$	(14,008	)	$	(1,216	)
Foreign:
Current	$	175,335		$	149,012		$	133,622
Deferred		36,439			45,313			11,015
	$	211,774		$	194,325		$	144,637
Total	$	91,389		$	124,596		$	111,086

The income tax provision differs from the amount computed by applying the U.S. statutory federal income tax rate to income before taxes. The sources and tax effects of the differences, including the impact of establishing tax contingency accruals, are as follows:


	Fiscal Year Ended
	December 31, 2022			December 25, 2021			December 26, 2020
Federal income tax expense at U.S. statutory rate	$	223,658		$	253,429		$	231,718
State income tax (benefit) expense, net of federal tax effect		(21,064	)		(12,198	)		(3,404	)
Foreign-derived intangible income (FDII) deduction		(12,343	)		—			—
Foreign tax rate differential		(114,599	)		(117,586	)		(98,130	)
Other foreign taxes less incentives and credits		24,273			29,240			3,446
Withholding tax		27,041			22,992			17,026
Net change in uncertain tax positions		(14,381	)		(17,087	)		(21,391	)
U.S. federal research and development credit		(29,384	)		(22,764	)		(21,342	)
Share-based compensation		30			(6,362	)		(6,114	)
Switzerland tax reform - tax assets		7,168			(177	)		11,016
Other, net		990			(4,891	)		(1,739	)
Income tax expense	$	91,389		$	124,596		$	111,086

The Company recorded income tax expense of $91,389 in the year ended December 31, 2022, which included income tax expense of $7,168 recognized by the Company in the fourth quarter of 2022 related to the revaluation of certain Switzerland tax assets related to the Switzerland tax reform transitional measures. The Company recorded income tax expense of $124,596 in the year ended December 25, 2021. The Company recorded income tax expense of $111,086 in the year ended December 26, 2020, which included a $14,308 income tax benefit recognized by the Company in the second quarter of 2020 due to the release of uncertain tax position reserves associated with a 2014 intercompany restructuring and was partially offset by income tax expense of $11,016 recognized by the Company in the fourth quarter of 2020 related to the revaluation of certain Switzerland tax assets related to the Switzerland tax reform transitional measures.

The Company’s statutory federal and cantonal income tax rate in Switzerland, the Company's place of incorporation, was approximately 14% in fiscal years 2022, 2021, and 2020. If the Company reconciled taxes at the Swiss holding company federal statutory tax rate to the reported income tax expense for 2022 as presented above, the amounts related to tax at the statutory rate would be approximately $77,000 lower, or $147,000, and the foreign tax rate differential would be adjusted by a similar amount to approximately $33,000. For 2021, the amounts related to tax at the statutory rate would be approximately $84,000 lower, or $169,000, and the foreign tax rate differential would be adjusted by a similar amount to approximately $28,000. For 2020, the amounts related to tax at the statutory rate would be approximately $77,000 lower, or $155,000, and the foreign tax rate differential would be adjusted by a similar amount to approximately $20,000. All other amounts would remain substantially unchanged.

The Company’s income before income taxes attributable to non-U.S. operations was $1,287,794, $1,227,666, and $1,059,074, for the years ended December 31, 2022, December 25, 2021, and December 26, 2020, respectively.

Income taxes of $45,459, $50,127, and $47,236 at December 31, 2022, December 25, 2021, and December 26, 2020, respectively, have not been accrued by the Company for the unremitted earnings of several of its foreign subsidiaries because such earnings are intended to be reinvested in the subsidiaries indefinitely.

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities are as follows:


	December 31, 2022			December 25, 2021
Deferred tax assets:
Product warranty accruals	$	12,111		$	10,578
Accrued vacation		14,986			14,073
Share-based compensation		8,667			12,000
Tax credit carryforwards		19,950			24,508
Intangible assets		156,702			173,468
Capitalized research & development expenses		231,429			53,827
Net operating losses		4,955			9,069
Operating leases		30,310			13,685
Deferred revenue		18,327			20,970
Tax basis in excess of book basis for investments		27,227			4,321
Other		18,259			20,220
Valuation allowance related to loss carryforward and tax credits		(17,077	)		(19,709	)
	$	525,846		$	337,010
Deferred tax liabilities:
Fixed assets		40,526			27,970
Operating leases		29,756			13,322
Prepaid and perpetual license assets		11,798			17,350
Book basis in excess of tax basis for acquired entities		21,970			32,907
Withholding tax		108,692			89,285
Other		1,998			13,566
	$	214,740		$	194,400
Net deferred tax assets	$	311,106		$	142,610

Deferred tax assets related to capitalized research and development expenses increased as of December 31, 2022 as compared to December 25, 2021 by $177,602, primarily related to the 2017 United States Tax Cuts and Jobs Act, which included provisions that became effective during 2022 tax year that require us to capitalize certain research and development costs and amortize those capitalized costs on our U.S. tax returns over a period of five or fifteen years, depending on where the associated costs were incurred.

At December 31, 2022, the Company had $19,950 of tax credit carryover compared to $24,508 at December 25, 2021. At December 31, 2022, the Company had a deferred tax asset of $4,955 related to the future tax benefit of net operating loss (NOL) carryforwards of $16,296. Included in the NOL carryforwards is $10,530 that relates to Luxembourg and expires beginning in 2037, $707 that relates to Finland and expires in varying amounts between 2025 and 2029, $575 that relates to the Netherlands and expires in 2026, $39 that relates to Thailand and expires in 2025, and $4,445 that relates to various other jurisdictions and has no expiration date. The Company has recorded a valuation allowance for a portion of its deferred tax asset relating to various tax attributes that it does not believe are more likely than not to be realized. In the future, if the Company determines, based on existence of sufficient evidence, that it should realize more or less of its deferred tax assets, an adjustment to the valuation allowance will be made in the period such a determination is made.

The total amount of gross unrecognized tax benefits, as of December 31, 2022 was $30,795. A reconciliation of the beginning and ending amount of gross unrecognized tax benefits for years ended December 31, 2022, December 25, 2021, and December 26, 2020 is as follows:


	December 31, 2022			December 25, 2021			December 26, 2020
Balance beginning of year	$	65,216		$	84,985		$	101,251
Additions based on tax positions related to prior years		—			—			10,480
Reductions based on tax positions related to prior years		(6,363	)		(4,727	)		(4,169	)
Additions based on tax positions related to current period		2,368			4,272			16,859
Reductions related to settlements with tax authorities		(15,476	)		—			(935	)
Expiration of statute of limitations		(14,950	)		(19,314	)		(38,501	)
Balance at end of year	$	30,795		$	65,216		$	84,985

Accounting guidance requires unrecognized tax benefits to be classified as noncurrent liabilities, except for the portion that is expected to be paid within one year of the balance sheet date. The balance of net unrecognized benefits of $29,159, $54,443, and $81,938 are required to be classified as noncurrent at December 31, 2022, December 25, 2021, and December 26, 2020, respectively. The net unrecognized tax benefits, if recognized, would reduce the effective tax rate. None of the unrecognized tax benefits are due to uncertainty in the timing of deductibility.

Interest and penalties, if any, accrued on the unrecognized tax benefits are reflected in income tax expense. At December 31, 2022, December 25, 2021, and December 26, 2020, the Company had accrued approximately $2,751, $4,225, and $5,666, respectively, for interest. The interest component of the reserve decreased income tax expense for the years ending December 31, 2022, December 25, 2021, and December 26, 2020 by $1,474, and $1,441, and $1,970, respectively. The Company did not have significant amounts accrued for penalties for the years ending December 31, 2022, December 25, 2021, and December 26, 2020.

The Company files income tax returns in Switzerland, Taiwan, United Kingdom, U.S. federal jurisdiction, as well as various states, local, and foreign jurisdictions. In its major tax jurisdictions, Switzerland, Taiwan, United Kingdom, and U.S. federal and various states, the Company is no longer subject to income tax examinations by tax authorities, with few exceptions, for years prior to 2018, 2017, 2020, and 2019, respectively.

The Company recognized a reduction of income tax expense, inclusive of interest and net of deferrals, of $12,749, $22,221, and $42,185 in fiscal years ended December 31, 2022, December 25, 2021, and December 26, 2020, respectively, to reflect the expiration of statutes of limitations and releases due to audit settlement in various jurisdictions.

The Company believes that it is reasonably possible that approximately $5,000 to $15,000 of its reserves for certain unrecognized tax benefits will decrease within the next 12 months as the result of the expiration of statutes of limitations. This potential decrease in unrecognized tax benefits would impact the Company’s effective tax rate within the next 12 months.