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Income Taxes | 12 Months Ended
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Jun. 30, 2022
Income Tax Disclosure [Abstract] |
Income Taxes | Note 16 – Income Taxes The domestic and foreign components of income before provision for income taxes are as follows (in thousands):
|  | Year Ended June 30, |
|  | 2022 |  |  | 2021 |  |  | 2020 |
Domestic |  | $ | 421,942 |  |  | $ | 471,711 |  |  | $ | 379,414 |
Foreign |  |  | 32,630 |  |  |  | 27,904 |  |  |  | 22,223 |
Income before income taxes |  | $ | 454,572 |  |  | $ | 499,615 |  |  | $ | 401,637 |
The components of income tax expense are as follows (in thousands):
|  | Year Ended June 30, |
|  | 2022 |  |  | 2021 |  |  | 2020 |
Current: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 66,956 |  |  | $ | (94,143 | ) |  | $ | 42,268 |
State and local |  |  | 1,372 |  |  |  | 19,958 |  |  |  | 14,744 |
Foreign |  |  | 9,880 |  |  |  | 7,384 |  |  |  | 5,271 |
Total current |  |  | 78,208 |  |  |  | (66,801 | ) |  |  | 62,283 |
Deferred: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | (12,884 | ) |  |  | 109,157 |  |  |  | 12,940 |
State and local |  |  | 22,140 |  |  |  | 185 |  |  |  | 5,465 |
Foreign |  |  | 314 |  |  |  | (369 | ) |  |  | (531 | )
Total deferred |  |  | 9,570 |  |  |  | 108,973 |  |  |  | 17,874 |
Total income tax expense |  | $ | 87,778 |  |  | $ | 42,172 |  |  | $ | 80,157 |
Income tax expense differs from the amounts computed by applying the U.S. federal statutory income tax rate of 21.0% as a result of the following (in thousands):
|  | Year Ended June 30, |
|  | 2022 |  |  | 2021 |  |  | 2020 |
Expected tax expense computed at federal statutory rate |  | $ | 95,460 |  |  | $ | 104,919 |  |  | $ | 84,344 |
State and local taxes, net of federal benefit |  |  | 21,295 |  |  |  | 21,252 |  |  |  | 15,965 |
Remeasurement of current year NOL |  |  | (1,124 | ) |  |  | (56,192 | ) |  |  | — |
R&D tax credit, net |  |  | (15,708 | ) |  |  | (18,173 | ) |  |  | (10,700 | )
Stock-based compensation |  |  | (3,981 | ) |  |  | (5,525 | ) |  |  | (10,900 | )
Nonincludible and nondeductible items, net |  |  | 1,588 |  |  |  | (2,269 | ) |  |  | 3,133 |
Remeasurement of deferred taxes |  |  | (5,629 | ) |  |  | — |  |  |  | — |
Other |  |  | (4,123 | ) |  |  | (1,840 | ) |  |  | (1,685 | )
Total income tax expense |  | $ | 87,778 |  |  | $ | 42,172 |  |  | $ | 80,157 |
Effective income tax rate |  |  | 19.3 | % |  |  | 8.4 | % |  |  | 20.0 | %
The effective tax rate for fiscal 2022 was favorably impacted primarily by federal research tax credits and the remeasurement of state deferred taxes. The effective tax rate for fiscal 2021 was favorably impacted primarily by the Company’s method of accounting changes that resulted in a carryback of a federal income NOL and related income tax benefit as well as federal research tax credits. The effective tax rate for fiscal 2020 was favorably impacted primarily by federal research tax credits and the amount of excess tax benefits under ASU 2016-09, Stock Compensation. The tax effects of temporary differences that give rise to deferred taxes are presented below (in thousands):
|  | June 30, |
|  | 2022 |  |  | 2021 |
Deferred tax assets: |  |  |  |  |  |  |  |
Operating lease liabilities |  | $ | 99,997 |  |  | $ | 110,282 |
Reserves and accruals |  |  | 46,513 |  |  |  | 58,900 |
Credits and net operating loss carryovers |  |  | 6,647 |  |  |  | 39,123 |
Deferred compensation and post-retirement obligations |  |  | 31,537 |  |  |  | 36,183 |
Stock-based compensation |  |  | 11,907 |  |  |  | 11,767 |
Interest rate swaps |  |  | — |  |  |  | 6,800 |
Other |  |  | — |  |  |  | 2,757 |
Total deferred tax assets |  |  | 196,601 |  |  |  | 265,812 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Goodwill and other intangible assets |  |  | (318,150 | ) |  |  | (291,282 | )
Property, plant and equipment |  |  | (102,940 | ) |  |  | (167,527 | )
Operating lease right-of-use assets |  |  | (80,551 | ) |  |  | (90,186 | )
Deferred revenue |  |  | (34,850 | ) |  |  | (35,115 | )
Prepaid expenses |  |  | (11,162 | ) |  |  | (8,932 | )
Interest rate swaps |  |  | (4,954 | ) |  |  | — |
Other |  |  | (835 | ) |  |  | — |
Total deferred tax liabilities |  |  | (553,442 | ) |  |  | (593,042 | )
Net deferred tax liability |  | $ | (356,841 | ) |  | $ | (327,230 | )
The deferred tax assets and liabilities were revalued in fiscal 2022 due to a reduction in the blended state effective tax rate. The Company is subject to income taxes in the U.S. and various state and foreign jurisdictions. Tax statutes and regulations within each jurisdiction are subject to interpretation and require the application of significant judgment. The Company is currently under examination by the Internal Revenue Service for fiscal 2017 through 2021. Based on the current IRS audit status and expected conclusion timing, approximately $73.5 million of federal income tax receivables have been classified as long term as of June 30, 2022. The Company does not expect the resolution of these examinations to have a material impact on its results of operations, financial condition or cash flows. U.S. income taxes have not been provided for undistributed earnings of foreign subsidiaries that have been permanently reinvested outside the United States. As of June 30, 2022, the estimated deferred tax liability associated with these undistributed earnings is approximately $2.6 million. Changes in the Company’s liability for unrecognized tax benefits is shown in the table below (in thousands):
|  | Year Ended June 30, |
|  | 2022 |  |  | 2021 |  |  | 2020 |
Beginning of year |  | $ | 31,505 |  |  | $ | 8,826 |  |  | $ | 1,530 |
Additions based on prior year tax positions |  |  | 8,221 |  |  |  | 20,025 |  |  |  | 5,003 |
Additions based on current year tax positions |  |  | 8,313 |  |  |  | 5,702 |  |  |  | 2,293 |
Settlement with taxing authorities |  |  | (5,229 | ) |  |  | (3,048 | ) |  |  | — |
End of year |  | $ | 42,810 |  |  | $ | 31,505 |  |  | $ | 8,826 |
The Company’s total liability for unrecognized tax benefits as of June 30, 2022, 2021 and 2020 was approximately $42.8 million, $31.5 million and $8.8 million, respectively. During fiscal 2022, the Company recognized an increase in reserves related to current and prior year research and development tax credits. Any amount, if recognized, would positively impact the Company’s effective tax rate. The Company recognizes net interest and penalties as a component of income tax expense. Over the next 12 months, the Company does not expect a significant increase or decrease in the unrecognized tax benefits recorded at June 30, 2022. As of June 30, 2022, the entire balance of unrecognized tax benefits is included in other long-term liabilities.

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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 https://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 https://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 https://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 https://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 https://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 https://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 https://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 https://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 https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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