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TAXES BASED ON INCOME | 12 Months Ended
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Jan. 29, 2022
TAXES BASED ON INCOME |
TAXES BASED ON INCOME |
4. | TAXES BASED ON INCOME
​ The provision for taxes based on income consists of: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | 2021 |  | 2020 |  | 2019 |
Federal | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Current | ​ | $ | 349 | ​ | $ | 577 | ​ | $ | 454 | ​
Deferred | ​ |  | (46) | ​ |  | 75 | ​ |  | (50) | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Subtotal federal | ​ |  | 303 | ​ |  | 652 | ​ |  | 404 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
State and local | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Current | ​ |  | 67 | ​ |  | 133 | ​ |  | 70 | ​
Deferred | ​ |  | 15 | ​ |  | (3) | ​ |  | (5) | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Subtotal state and local | ​ |  | 82 | ​ |  | 130 | ​ |  | 65 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total | ​ | $ | 385 | ​ | $ | 782 | ​ | $ | 469 | ​
​ A reconciliation of the statutory federal rate and the effective rate follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | 2021 |  | 2020 |  | 2019 |
Statutory rate |  | 21.0 | % | 21.0 | % | 21.0 | %
State income taxes, net of federal tax benefit |  | 3.2 | ​ | 3.0 | ​ | 2.6 | ​
Credits |  | (1.3) | ​ | (0.7) | ​ | (1.5) | ​
Resolution of tax audit examinations |  | (3.1) | ​ | — | ​ | (0.1) | ​
Excess tax benefits from share-based payments | ​ | (1.3) | ​ | (0.8) | ​ | (0.2) | ​
Impairment losses attributable to noncontrolling interest | ​ | — | ​ | — | ​ | 1.2 | ​
Non-deductible executive compensation | ​ | 0.6 | ​ | 0.3 | ​ | 0.3 | ​
Other changes, net |  | (0.3) | ​ | 0.4 | ​ | 0.4 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | 18.8 | % | 23.2 | % | 23.7 | %
​ The Company’s effective income tax rates were 18.8% in 2021 and 23.2% in 2020. The 2021 tax rate differed from the federal statutory rate primarily due to a discrete benefit of $47 which was primarily from the favorable outcome of income tax audit examinations covering multiple years, the benefit from share-based payments and the utilization of tax credits, partially offset by the effect of state income taxes. ​ The 2020 tax rate differed from the federal statutory rate primarily due to the effect of state income taxes, partially offset by the utilization of tax credits and deductions. ​ The 2019 tax rate differed from the federal statutory rate primarily due to the effect of state income taxes and Lucky’s Market losses attributable to the noncontrolling interest, which reduced pre-tax income but did not impact tax expense. The tax effects of significant temporary differences that comprise tax balances were as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | 2021 |  | 2020 |
Deferred tax assets: | ​ | ​ | ​ | ​ | ​ | ​ | ​
Compensation related costs | ​ | $ | 560 | ​ | $ | 766 | ​
Lease liabilities | ​ |  | 1,926 | ​ |  | 1,932 | ​
Closed store reserves | ​ |  | 46 | ​ |  | 38 | ​
Net operating loss and credit carryforwards | ​ |  | 98 | ​ |  | 86 | ​
Deferred income | ​ | ​ | 126 | ​ | ​ | 149 | ​
Allowance for uncollectible receivables | ​ | ​ | 36 | ​ | ​ | 23 | ​
Other | ​ | ​ | 25 | ​ |  | 46 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Subtotal | ​ |  | 2,817 | ​ |  | 3,040 | ​
Valuation allowance | ​ |  | (72) | ​ |  | (53) | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total deferred tax assets | ​ |  | 2,745 | ​ |  | 2,987 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Deferred tax liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​
Depreciation and amortization | ​ |  | (2,006) | ​ |  | (2,115) | ​
Operating lease assets | ​ |  | (1,790) | ​ | ​ | (1,794) | ​
Insurance related costs | ​ | ​ | (54) | ​ | ​ | — | ​
Inventory related costs | ​ | ​ | (310) | ​ | ​ | (264) | ​
Equity investments in excess of tax basis | ​ | ​ | (147) | ​ | ​ | (356) | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total deferred tax liabilities | ​ |  | (4,307) | ​ |  | (4,529) | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Deferred taxes | ​ | $ | (1,562) | ​ | $ | (1,542) | ​
​ At January 29, 2022, the Company had net operating loss carryforwards for state income tax purposes of $1,259. These net operating loss carryforwards expire from 2022 through 2041. The utilization of certain of the Company’s state net operating loss carryforwards may be limited in a given year. Further, the Company has recorded a valuation allowance against certain deferred tax assets resulting from its state net operating losses. ​ At January 29, 2022, the Company had state credit carryforwards of $37. These state credit carryforwards expire from 2022 through 2035. The utilization of certain of the Company’s credits may be limited in a given year. Further, the Company has recorded a valuation allowance against certain deferred tax assets resulting from its state credits. ​ The Company regularly reviews all deferred tax assets on a tax filer and jurisdictional basis to estimate whether these assets are more likely than not to be realized based on all available evidence. This evidence includes historical taxable income, projected future taxable income, the expected timing of the reversal of existing temporary differences and the implementation of tax planning strategies. Projected future taxable income is based on expected results and assumptions as to the jurisdiction in which the income will be earned. The expected timing of the reversals of existing temporary differences is based on current tax law and the Company’s tax methods of accounting. Unless deferred tax assets are more likely than not to be realized, a valuation allowance is established to reduce the carrying value of the deferred tax asset until such time that realization becomes more likely than not. Increases and decreases in these valuation allowances are included in "Income tax expense" in the Consolidated Statements of Operations. As of January 29, 2022, January 30, 2021 and February 1, 2020 the total valuation allowance was $72, $53 and $55, respectively. ​ A reconciliation of the beginning and ending amount of unrecognized tax benefits, including positions impacting only the timing of tax benefits, is as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | 2021 |  | 2020 |  | 2019 |
Beginning balance | ​ | $ | 193 | ​ | $ | 174 | ​ | $ | 174 | ​
Additions based on tax positions related to the current year | ​ |  | 10 | ​ |  | 7 | ​ |  | 13 | ​
Additions for tax positions of prior years | ​ |  | 9 | ​ |  | 16 | ​ |  | 8 | ​
Reductions for tax positions of prior years | ​ |  | (108) | ​ |  | — | ​ |  | (1) | ​
Settlements | ​ | ​ | — | ​ |  | — | ​ |  | (19) | ​
Lapse of statute | ​ | ​ | (4) | ​ | ​ | (4) | ​ | ​ | (1) | ​
Ending balance | ​ | $ | 100 | ​ | $ | 193 | ​ | $ | 174 | ​
​ As of January 29, 2022, January 30, 2021 and February 1, 2020, the amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate was $73, $85 and $74 respectively. ​ To the extent interest and penalties would be assessed by taxing authorities on any underpayment of income tax, such amounts have been accrued and classified as a component of income tax expense. During the years ended January 29, 2022, January 30, 2021 and February 1, 2020, the Company recognized approximately $(15), $7 and $7, respectively, in interest and penalties (recoveries). The Company had accrued approximately $22, $38 and $30 for the payment of interest and penalties as of January 29, 2022, January 30, 2021 and February 1, 2020. ​ As of January 29, 2022, the Internal Revenue Service had concluded its examination of all federal tax returns up to and including the return for the year ended February 3, 2018. ​ The Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), which was enacted on March 27, 2020, includes measures to assist companies in response to the COVID-19 pandemic. These measures include deferring the due dates of tax payments and other changes to income and non-income-based tax laws. As permitted under the CARES Act, the Company deferred the remittance of the employer portion of the social security tax. The social security tax provision requires that the deferred employment tax be paid over two years, with half of the amount required to be paid by December 31, 2021 and the other half to be paid by December 31, 2022. During 2020, the Company deferred the employer portion of social security tax of $622. Of the total, $311 was paid during 2021 and $311 is included in “Other current liabilities” in the Company’s Consolidated Balance Sheets.

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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://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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