XML 43 R21.htm IDEA: XBRL DOCUMENT
v3.21.1

Income Taxes | 12 Months Ended
--- | ---
Apr. 02, 2021
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The components of our income (loss) from continuing operations before income taxes are as follows:
| Year Ended
(In millions) | April 2, 2021 |  | April 3, 2020 |  | March 29, 2019
Domestic | $ | 607 |  |  | $ | 667 |  |  | $ | (179) |
International | 265 |  |  | 152 |  |  | 72 |
Income (loss) before income taxes | $ | 872 |  |  | $ | 819 |  |  | $ | (107) |
The components of income tax expense (benefit) from continuing operations are as follows:
| Year Ended
(In millions) | April 2, 2021 |  | April 3, 2020 |  | March 29, 2019
Current: |  |  |  |  |
Federal | $ | 133 |  |  | $ | 208 |  |  | $ | 58 |
State | 36 |  |  | 33 |  |  | 4 |
International | (13) |  |  | 3 |  |  | (14) |
Total | 156 |  |  | 244 |  |  | 48 |
Deferred: |  |  |  |  |
Federal | (6) |  |  | (23) |  |  | (35) |
State | (5) |  |  | 3 |  |  | (3) |
International | 31 |  |  | 17 |  |  | (7) |
Total | 20 |  |  | (3) |  |  | (45) |
Income tax expense | $ | 176 |  |  | $ | 241 |  |  | $ | 3 |
The U.S. federal statutory income tax rates we have applied for fiscal 2021, 2020, and 2019 are as follows:
| Year Ended
| April 2, 2021 |  | April 3, 2020 |  | March 29, 2019
U.S. federal statutory income tax rate | 21.0 | % |  | 21.0 | % |  | 21.0 | %
The difference between our effective income tax and the federal statutory income tax is as follows:
| Year Ended
(In millions) | April 2, 2021 |  | April 3, 2020 |  | March 29, 2019
Federal statutory tax expense (benefit) | $ | 183 |  |  | $ | 172 |  |  | $ | (23) |
State taxes, net of federal benefit | 25 |  |  | 22 |  |  | (11) |
Foreign earnings taxed at other than the federal rate | 7 |  |  | (2) |  |  | (24) |
Transition tax | — |  |  | — |  |  | (2) |
Federal research and development credit | (1) |  |  | (2) |  |  | (4) |
Valuation allowance increase (decrease) | 1 |  |  | (57) |  |  | 26 |
Change in uncertain tax positions | 3 |  |  | 60 |  |  | 44 |
Stock-based compensation | 5 |  |  | 5 |  |  | 8 |
Nondeductible goodwill | — |  |  | 18 |  |  | — |
Favorable ruling on foreign withholding tax | (35) |  |  | — |  |  | — |
US tax on foreign earnings | (15) |  |  | (4) |  |  | (1) |
Return to provision adjustment | 1 |  |  | 12 |  |  | (16) |
Other, net | 2 |  |  | 17 |  |  | 6 |
Income tax expense | $ | 176 |  |  | $ | 241 |  |  | $ | 3 |
The principal components of deferred tax assets and liabilities are as follows:
(In millions) | April 2, 2021 |  | April 3, 2020
Deferred tax assets: |  |  |
Tax credit carryforwards | $ | 2 |  |  | $ | 6 |
Net operating loss carryforwards of acquired companies | 23 |  |  | 21 |
Other accruals and reserves not currently tax deductible | 54 |  |  | 46 |
Operating lease liabilities | 29 |  |  | 12 |
Deferred revenue | — |  |  | 2 |
Property and equipment | 17 |  |  | 10 |
Intangible assets | 103 |  |  | 117 |
Loss on investments not currently tax deductible | — |  |  | 1 |
Stock-based compensation | 7 |  |  | 21 |
Other | 36 |  |  | 44 |
Gross deferred tax assets | 271 |  |  | 280 |
Valuation allowance | (7) |  |  | (9) |
Deferred tax assets, net of valuation allowance | 264 |  |  | 271 |
Deferred tax liabilities: |  |  |
Operating lease assets | (25) |  |  | (10) |
Goodwill | (1) |  |  | — |
Deferred revenue | (1) |  |  | — |
Unremitted earnings of foreign subsidiaries | (15) |  |  | (17) |
Prepaids and deferred expenses | (2) |  |  | (2) |
Discount on convertible debt | (2) |  |  | (4) |
Deferred tax liabilities | (46) |  |  | (33) |
Net deferred tax assets (liabilities) | $ | 218 |  |  | $ | 238 |
The valuation allowance provided against our deferred tax assets as of April 2, 2021, decreased primarily due to a change in tax credit carryforwards. The ending valuation allowance of $7 million is provided primarily against certain foreign tax credits. As of April 2, 2021, we have U.S. federal net operating losses attributable to various acquired companies of approximately $77 million, which, if not used, will expire between fiscal 2022 and 2039. The remaining net operating loss carryforwards are subject to an annual limitation under U.S. federal tax regulations but are expected to be fully realized. Furthermore, we have U.S. state net operating loss carryforwards attributable to various acquired companies of approximately $13 million. If not used, our U.S. state net operating losses will expire between fiscal 2022 and 2038. In addition, we have foreign net operating loss carryforwards attributable to various foreign companies of approximately $26 million. In assessing the ability to realize our deferred tax assets, we considered whether it is more likely than not that some portion or all the deferred tax assets will not be realized. We considered the following: we have historical cumulative book income, as measured by the current and prior two years; we have strong, consistent taxpaying history; we have substantial U.S. federal income tax carryback potential; and we have substantial amounts of scheduled future reversals of taxable temporary differences from our deferred tax liabilities. We have concluded that this positive evidence outweighs the negative evidence and, thus, that the deferred tax assets as of April 2, 2021, are realizable on a “more likely than not” basis. The aggregate changes in the balance of gross unrecognized tax benefits were as follows:
| Year Ended
(In millions) | April 2, 2021 |  | April 3, 2020 |  | March 29, 2019
Balance at beginning of year | $ | 724 |  |  | $ | 446 |  |  | $ | 378 |
Settlements with tax authorities | (37) |  |  | (5) |  |  | (3) |
Lapse of statute of limitations | (34) |  |  | (15) |  |  | (17) |
Increase related to prior period tax positions | 13 |  |  | 77 |  |  | 16 |
Decrease related to prior period tax positions | (129) |  |  | (11) |  |  | (11) |
Increase related to current year tax positions | 11 |  |  | 232 |  |  | 75 |
Increase due to acquisition | — |  |  | — |  |  | 8 |
Balance at end of year | $ | 548 |  |  | $ | 724 |  |  | $ | 446 |
There was a change of $176 million in gross unrecognized tax benefits during the year ended April 2, 2021, as disclosed above. This gross liability does not include offsetting tax benefits associated with the correlative effects of potential transfer pricing adjustments, interest deductions, and state income taxes. Of the total unrecognized tax benefits at April 2, 2021, $494 million, if recognized, would affect our effective tax rate. We recognize interest and/or penalties related to uncertain tax positions in income tax expense. At April 2, 2021, before any tax benefits, we had $74 million of accrued interest and penalties on unrecognized tax benefits. Interest included in our provision for income taxes was an expense of approximately $26 million for fiscal 2021. If the accrued interest and penalties do not ultimately become payable, amounts accrued will be reduced in the period that such determination is made and reflected as a reduction of the overall income tax provision. On July 27, 2015, the United States Tax Court (Tax Court) issued its opinion in Altera v. Commissioner and concluded that related parties in a cost sharing arrangement are not required to share expenses related to stock-based compensation. The Commissioner of the Internal Revenue Service appealed the Tax Court decision to the Ninth Circuit. In June 2019, the U.S. Court of Appeals for the Ninth Circuit reversed the July 2015 decision of the U.S. Tax Court. As a result of this decision, we recorded a cumulative income tax expense of $62 million in the first quarter of fiscal 2020. On July 22, 2019, the taxpayer requested a rehearing before the full Ninth Circuit, but such request was denied on November 12, 2019. In February 2020, Altera requested a hearing before the Supreme Court of the United States. In June 2020, the Supreme Court declined to review the case. We file income tax returns in the U.S. on a federal basis and in many U.S. state and foreign jurisdictions. Our most significant tax jurisdictions are the U.S. and Ireland. Our tax filings remain subject to examination by applicable tax authorities for a certain length of time following the tax year to which those filings relate. Our fiscal years 2014 through 2021 remain subject to examination by the IRS for U.S. federal tax purposes. Our fiscal years prior to 2014 have been settled and closed with the IRS. Our fiscal years 2014 to 2019 are currently under audit by the IRS. Our 2016 through 2021 fiscal years remain subject to examination by the appropriate governmental agencies for Irish tax purposes. The timing of the resolution of income tax examinations is highly uncertain, and the amounts ultimately paid, if any, upon resolution of the issues raised by the taxing authorities may differ materially from the amounts accrued for each year. Although potential resolution of uncertain tax positions involves multiple tax periods and jurisdictions, it is reasonably possible that the gross unrecognized tax benefits related to these audits could decrease (whether by payment, release, or a combination of both) in the next 12 months. Depending on the nature of the settlement or expiration of statutes of limitations, it could affect our income tax provision and therefore benefit the resulting effective tax rate. We continue to monitor the progress of ongoing income tax controversies and the impact, if any, of the expected tolling of the statute of limitations in various taxing jurisdictions.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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=84230637&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=116825942&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=84230637&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=116825942&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=84230637&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 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration