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Income Taxes | 12 Months Ended
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Jan. 28, 2023
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The components of the provision (benefit) for income taxes were as follows (dollars in thousands):
| Fiscal Year Ended |
| January 28, 2023 |  | January 29, 2022 |  | January 30, 2021 |
Current: |  |  |  |  |  |
Federal | $ | 24,917 |  |  | $ | (3,323) |  |  | $ | 42,794 |  |
Foreign | — |  |  | (4) |  |  | (2) |  |
State | 8,460 |  |  | (495) |  |  | 10,273 |  |
| 33,377 |  |  | (3,822) |  |  | 53,065 |  |
Deferred: |  |  |  |  |  |
Federal | 6,094 |  |  | 7,506 |  |  | (24,380) |  |
Foreign | — |  |  | — |  |  | — |  |
State | (1,562) |  |  | 518 |  |  | (3,805) |  |
| 4,532 |  |  | 8,024 |  |  | (28,185) |  |
Provision for income taxes | $ | 37,909 |  |  | $ | 4,202 |  |  | $ | 24,880 |  |
Our effective income tax rate differs from the statutory rate primarily due to the difference in income tax rates from state to state where work was performed, non-deductible and non-taxable items, tax credits recognized, the tax effects of the vesting and exercise of share-based awards, impacts of tax filings for prior years, and changes in unrecognized tax benefits. During fiscal 2021 our effective tax rate was impacted by a $53.3 million goodwill impairment charge which was mostly non-deductible for income tax purposes. During the first quarter of fiscal 2023, we were notified by the Internal Revenue Service that our federal income tax return for fiscal 2016 was selected for examination due to the net operating loss carryback claim filed in fiscal 2021. In addition, fiscal year 2020 was selected for examination in the second quarter of fiscal 2022. We were notified in the fourth quarter of this fiscal year that we have been selected for an income tax audit in Canada for fiscal years 2017 through 2020. We believe our provision for income taxes is adequate; however, any assessment may affect our results of operations and cash flows.
| Fiscal Year Ended |
| January 28, 2023 |  | January 29, 2022 |  | January 30, 2021 |
Statutory rate applied to pre-tax income | $ | 37,826 |  |  | $ | 11,083 |  |  | $ | 12,436 |  |
State taxes, net of federal tax benefit | 5,325 |  |  | 1,422 |  |  | 4,344 |  |
Change in accruals for uncertain tax positions | 3,833 |  |  | 4,493 |  |  | 1,189 |  |
Compensation limitation | 3,959 |  |  | 1,468 |  |  | 2,632 |  |
Tax filings for prior periods | (2,505) |  |  | (4,609) |  |  | — |  |
Tax credits | (5,056) |  |  | (3,756) |  |  | (3,145) |  |
Federal benefit of vesting and exercise of share-based awards | (3,515) |  |  | (2,425) |  |  | (436) |  |
Deferred tax remeasurements | 371 |  |  | (1,355) |  |  | — |  |
Effect of rates other than statutory | (203) |  |  | 71 |  |  | (4) |  |
Non-deductible and non-taxable items, net | 215 |  |  | 70 |  |  | 808 |  |
Change in valuation allowance | (376) |  |  | (12) |  |  | 1 |  |
Non-deductible goodwill impairment | — |  |  | — |  |  | 10,411 |  |
Tax Reform and related effects | — |  |  | — |  |  | (2,631) |  |
Other items, net | (1,965) |  |  | (2,248) |  |  | (725) |  |
Provision for income taxes | $ | 37,909 |  |  | $ | 4,202 |  |  | $ | 24,880 |  |
Deferred Income Taxes The deferred tax provision represents the change in the deferred tax assets and the liabilities representing the tax consequences of changes in the amount of temporary differences and changes in tax rates during the year. The significant components of deferred tax assets and liabilities consisted of the following (dollars in thousands):
| January 28, 2023 |  | January 29, 2022
Deferred tax assets: |  |  |
Insurance and other reserves | $ | 22,866 |  |  | $ | 19,407 |
Capitalized research expenditures (IRC Section 174) | 19,498 |  |  | — |
Leases | 17,096 |  |  | 15,718 |
Stock-based compensation | 3,577 |  |  | 2,303 |
Allowance for doubtful accounts and reserves | 2,984 |  |  | 1,356 |
Net operating loss carryforwards | 591 |  |  | 9,183 |
CARES Act tax deferral | — |  |  | 4,791 |
Other | 5,080 |  |  | 6,233 |
Total deferred tax assets | 71,692 |  |  | 58,991 |
Valuation allowance | (634) |  |  | (1,131) |
Deferred tax assets, net of valuation allowance | $ | 71,058 |  |  | $ | 57,860 |
Deferred tax liabilities: |  |  |
Property and equipment | $ | 77,024 |  |  | $ | 63,310 |
Goodwill and intangibles | 36,132 |  |  | 33,221 |
Leases | 17,178 |  |  | 15,822 |
Other | 929 |  |  | 1,181 |
Deferred tax liabilities | $ | 131,263 |  |  | $ | 113,534 |
Net deferred tax liabilities | $ | 60,205 |  |  | $ | 55,674 |
The 2017 Tax Cuts and Jobs Act ("TCJA") amended Internal Revenue Code Section 174 to require taxpayers to capitalize certain research and experimental (R&E) expenditures. This regulatory change is effective for amounts paid or incurred in tax years beginning after December 31, 2021. A new deferred tax asset has been established in relation to this law change and the capitalized Section 174 costs must be amortized over five years. The valuation allowance above reduces the deferred tax asset balances to the amount that we have determined is more likely than not to be realized. The valuation allowance primarily relates to immaterial foreign net operating loss carryforwards and immaterial state net operating loss carryforwards, which generally begin to expire in fiscal 2024. Uncertain Tax Positions As of January 28, 2023 and January 29, 2022, we had total unrecognized tax benefits of $15.8 million and $11.9 million, respectively, resulting from uncertain tax positions. Our effective tax rate will be reduced by $14.7 million during future periods if it is determined these unrecognized tax benefits are realizable. We had approximately $2.6 million and $2.3 million accrued for the payment of interest and penalties as of January 28, 2023 and January 29, 2022, respectively. Interest expense related to unrecognized tax benefits for the Company was not material during fiscal 2023, fiscal 2022, and fiscal 2021. A summary of unrecognized tax benefits is as follows (dollars in thousands):
| Fiscal Year Ended |
| January 28, 2023 |  | January 29, 2022 |  | January 30, 2021 |
Balance at beginning of year | $ | 11,929 |  |  | $ | 5,940 |  |  | $ | 4,742 |  |
Additions based on tax positions related to the fiscal year | 2,042 |  |  | 1,377 |  |  | 1,075 |  |
Additions based on tax positions related to prior years | 2,957 |  |  | 4,612 |  |  | 530 |  |
Reductions related to the expiration of statutes of limitation | (1,157) |  |  | — |  |  | (407) |  |
Balance at end of year | $ | 15,771 |  |  | $ | 11,929 |  |  | $ | 5,940 |  |

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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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