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Income Taxes
 9 Months Ended
Dec. 28, 2024
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Effective Tax Rate
The Company's effective tax rate, which is calculated by dividing each fiscal period's income tax provision by pretax income, was 22.5% and 22.1% during the three-month and nine-month periods ended December 28, 2024, respectively, and 16.1% and 16.6% during the three-month and nine-month periods ended December 30, 2023, respectively. The effective tax rates for the three-month and nine-month periods ended December 28, 2024 were higher than the U.S. federal statutory income tax rate of 21% primarily due to uncertain tax positions and state taxes, partially offset by a favorable tax adjustment related to the revaluation of a deferred tax liability on foreign earnings. The effective tax rates for the three-month and nine-month periods ended December 30, 2023 were lower than the U.S. federal statutory income tax rate of 21% primarily due to deferred tax benefits recognized as a result of transactions entered into as part of a reorganization of the Company's legal entity structure and as a result of changes in tax legislation. The lower effective tax rate for the nine months ended December 30, 2023 was also driven by favorable adjustments related to the revaluation of deferred tax assets arising from Swiss tax reform and favorable deferred tax adjustments related to the European Union's anti-tax avoidance directive.
Uncertain Income Tax Benefits
The Company classifies interest and penalties related to unrecognized tax benefits as part of its income tax provision. The total amount of unrecognized tax benefits, including interest and penalties, was $170.6 million and $118.7 million as of December 28, 2024 and March 30, 2024, respectively, and was included within the non-current liability for unrecognized tax benefits in the consolidated balance sheets.
The total amount of unrecognized tax benefits that, if recognized, would affect the Company's effective tax rate was $87.3 million and $80.1 million as of December 28, 2024 and March 30, 2024, respectively.
On August 26, 2024, the U.S. Tax Court issued a decision in Varian Medical Systems, Inc. v. Commissioner related to the Tax Cuts and Jobs Act deduction for certain deemed foreign dividends otherwise subject to the transition tax on unrepatriated earnings of applicable foreign subsidiaries. Based on the Company's evaluation of the technical merits of this decision, it has filed a protective refund claim with the Internal Revenue Service claiming a transition tax refund of $34.4 million, for which the Company has recorded a corresponding deferred tax asset. However, at this time the Company believes it is more-likely-than-not that the intended refund claim will not be received. Therefore, the Company has recorded an uncertain tax position reserve for the full refund claim of $34.4 million. Accordingly, on a net basis, this development had no resulting impact to the Company's effective tax rates or its consolidated statements of operations during the three-month and nine-month periods ended December 28, 2024.
Future Changes in Unrecognized Tax Benefits
The total amount of unrecognized tax benefits relating to the Company's tax positions is subject to change based on future events including, but not limited to, settlements of ongoing tax audits and assessments and the expiration of applicable statutes of limitations. Although the outcomes and timing of such events are highly uncertain, the Company does not anticipate that the balance of gross unrecognized tax benefits, excluding interest and penalties, will change significantly during the next twelve months. However, changes in the occurrence, expected outcomes, and timing of such events could cause the Company's current estimate to change materially in the future.
The Company files a consolidated U.S. federal income tax return, as well as tax returns in various state, local, and foreign jurisdictions. The Company is generally no longer subject to examinations by the relevant tax authorities for years prior to its fiscal year ended March 29, 2014.