Income Taxes (Tables)

12 Months Ended

Sep. 28, 2018

Components of Consolidated Income Tax Expense

The following table presents the components of our consolidated income tax expense for years ended September 28, 2018, September 29, 2017 and September 30, 2016 (in thousands):



	For the Years Ended
	September 28, 2018			September 29, 2017		September 30, 2016
Current income tax expense:
Federal	$	34,145		$	29,297	$	36,020
State	(597		)	8,535		11,336
Foreign	59,889			31,347		52,259
Total current tax expense	93,437			69,179		99,615
Deferred income tax expense (benefit):
Federal	252,730			29,390		6,439
State	15,485			3,407		485
Foreign	19,911			3,866		(34,331		)
Total deferred tax expense (benefit)	288,126			36,663		(27,407		)
Consolidated income tax expense	$	381,563		$	105,842	$	72,208

Components of Deferred Tax Assets

The following table presents the components of our net deferred tax assets at September 28, 2018 and September 29, 2017 (in thousands):



	September 28, 2018			September 29, 2017
Deferred tax assets:
Obligations relating to:
Defined benefit pension plans	$	30,483		$	52,299
Other employee benefit plans	190,548			192,299
Net Operating Losses	167,424			136,783
Foreign Tax Credit	145,931			—
Other Credits	8,764
Self-insurance programs	—			489
Contract revenues and costs	130,116			(18,374		)
Deferred Rent	5,454			25,654
Restructuring	14,515			18,258
Other	3,533			19,389
Valuation Allowance	(264,944		)	(58,097		)
Gross deferred tax assets	431,824			368,700
Deferred tax liabilities:
Depreciation and amortization	(206,705		)	(176,327		)
Self-insurance programs	(3,513		)	—
Unremitted earnings	(79,418		)	—
Other, net	—			(1,438		)
Gross deferred tax liabilities	(289,636		)	(177,765		)
Net deferred tax assets	$	142,188		$	190,935

Income Tax Benefits Realized from the Exercise of Nonqualified Stock Options, and Disqualifying Dispositions of Stock Sold Under our Employee Stock Purchase Plans

The following table presents the income tax benefits realized from the exercise of non-qualified stock options and disqualifying dispositions of stock sold under our employee stock purchase plans for the years ended September 28, 2018, September 29, 2017 and September 30, 2016 (in millions):



For the Years Ended
September 28, 2018		September 29, 2017		September 30, 2016
$	4.7	$	5.2	$	1.5

Income Tax Expense in Consolidated Statements of Earnings

The following table reconciles total income tax expense using the statutory U.S. federal income tax rate to the consolidated income tax expense shown in the accompanying Consolidated Statements of Earnings for the years ended September 28, 2018, September 29, 2017 and September 30, 2016 (dollars in thousands):



	For the Years Ended
	September 28, 2018		%		September 29, 2017			%		September 30, 2016			%
Statutory amount	$	136,458	24.6	%	$	137,626		35.0	%	$	100,353		35.0	%
State taxes, net of the federal benefit	7,587		1.4	%	8,955			2.3	%	7,853			2.7	%
Exclusion of tax on non-controlling interests	(2,389)		(0.4	)%	2,223			0.6	%	(1,418		)	(0.5	)%
Foreign:
Difference in tax rates of foreign operations	9,860		1.8	%	(16,987		)	(4.3	)%	(17,184		)	(6.0	)%
Benefit from foreign valuation allowance release	(5,105)		(0.9	)%	(3,085		)	(0.8	)%	(11,182		)	(3.9	)%
U.K. tax rate change on deferred tax assets	—		—		—			—	%	8,853			3.1	%
Nontaxable income from foreign affiliate	—		—		(3,280		)	(0.8	)%	—			—
U.S. tax cost of foreign operations	6,577		1.2	%	18,612			4.7	%	30,850			10.9	%
Tax differential on foreign earnings	11,332		2.0	%	(4,740		)	(1.2	)%	11,337			4.1	%
Foreign tax credits	(21,729)		(3.9	)%	(20,454		)	(5.2	)%	(44,018		)	(15.4	)%
Tax Reform	154,150		27.8	%	—			—		—			—
Valuation Allowance	104,221		18.8	%	—			—		—			—
Uncertain tax positions	(1,297)		(0.2	)%	(5,779		)	(1.5	)%	1,449			0.5	%
Other items:
IRS §179D deduction	(4,520)		(0.8	)%	(3,351		)	(0.8	)%	(2,153		)	(0.8	)%
IRS §199D deduction	—		—		(2,113		)	(0.5	)%	(2,800		)	(1.0	)%
Foreign partnership income/(loss)	(3,990)		(0.7	)%	(9,861		)	(2.5	)%	(2,658		)	(0.9	)%
Other items – net	1,740		0.3	%	3,336			0.7	%	4,263			1.5	%
Total other items	(6,770)		(1.2	)%	(11,989		)	(3.1	)%	(3,348		)	(1.2	)%
Taxes on income	$	381,563	68.9	%	$	105,842		26.9	%	$	72,208		25.2	%

Income Tax Payments

The following table presents income tax payments made during the years ended September 28, 2018, September 29, 2017 and September 30, 2016 (in millions):



September 28, 2018		September 29, 2017		September 30, 2016
$	44.29	$	78.39	$	116.30

Components of our Consolidated Earnings Before Taxes

The following table presents the components of our consolidated earnings before taxes for the years ended September 28, 2018, September 29, 2017 and September 30, 2016 (in thousands):



	For the Years Ended
	September 28, 2018		September 29, 2017		September 30, 2016
United States earnings	$	282,123	$	232,342	$	206,159
Foreign earnings	272,582		160,875		80,564
	$	554,705	$	393,217	$	286,723

Schedule of Unrecognized Tax Benefits Roll Forward

The following table presents the reconciliation of the beginning and ending amount of unrecognized tax benefits for the years ended September 28, 2018, September 29, 2017 and September 30, 2016 (in thousands):



	For the Years Ended
	September 28, 2018			September 29, 2017			September 30, 2016
Balance, beginning of year	$	38,580		$	44,167		$	42,666
Acquisition of CH2M	137,912			—			—
Additions based on tax positions related to the current year	9,780			5,900			5,670
Additions for tax positions of prior years	5,561			237			367
Reductions for tax positions of prior years	(8,962		)	(4,524		)	(2,451		)
Settlement	(3,731		)	(7,200		)	(2,085		)
Balance, end of year	$	179,140		$	38,580		$	44,167