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Income Taxes
 12 Months Ended
Jan. 25, 2025
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The components of the provision for income taxes were as follows (dollars in thousands):
Fiscal Year Ended
January 25, 2025January 27, 2024January 28, 2023
Current:
Federal$73,398 $65,540 $24,917 
Foreign— 13 — 
State18,369 18,166 8,460 
91,767 83,719 33,377 
Deferred:
Federal(15,411)(10,000)6,094 
Foreign— — — 
State(1,979)(643)(1,562)
(17,390)(10,643)4,532 
Provision for income taxes$74,377 $73,076 $37,909 

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.

We are currently under IRS audit for fiscal year 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 25, 2025January 27, 2024January 28, 2023
Statutory rate applied to pre-tax income$64,636 $61,320 $37,826 
State taxes, net of federal tax benefit12,021 13,466 5,325 
Change in accruals for uncertain tax positions3,797 2,331 3,833 
Compensation limitation9,890 2,788 3,959 
Tax filings for prior periods— — (2,505)
Tax credits(6,558)(4,453)(5,056)
Federal benefit of vesting and exercise of share-based awards(8,410)(2,413)(3,515)
Deferred tax remeasurements— — 371 
Effect of rates other than statutory511 241 (203)
Non-deductible and non-taxable items, net1,446 1,090 215 
Change in valuation allowance— (546)(376)
Other items, net(2,956)(748)(1,965)
Provision for income taxes$74,377 $73,076 $37,909 

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 25, 2025January 27, 2024
Deferred tax assets:
Capitalized research expenditures (IRC Section 174)$65,763 $38,689 
Insurance and other reserves22,251 25,865 
Leases28,088 19,380 
Stock-based compensation4,635 4,722 
Allowance for credit losses accounts and reserves5,970 3,203 
Net operating loss carryforwards114 238 
Other4,315 3,686 
Total deferred tax assets131,136 95,783 
Valuation allowance(77)(79)
Deferred tax assets, net of valuation allowance$131,059 $95,704 
Deferred tax liabilities:
Property and equipment$89,295 $86,105 
Goodwill and intangibles39,106 38,381 
Leases27,951 19,439 
Capitalized costs5,843 — 
Other1,036 1,341 
Deferred tax liabilities$163,231 $145,266 
Net deferred tax liabilities$32,172 $49,562 

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 relates to immaterial tax attributes which are not more-likely-than-not to be realized prior to expiration, based on current objective evidence. Our tax attributes generally begin to expire in fiscal 2026.
Uncertain Tax Positions

As of January 25, 2025 and January 27, 2024, we had total unrecognized tax benefits of $21.6 million and $17.6 million, respectively, resulting from uncertain tax positions. Our effective tax rate will be reduced by $21.1 million during future periods if it is determined these unrecognized tax benefits are realizable. We had approximately $5.4 million and $3.7 million accrued for the payment of interest and penalties as of January 25, 2025 and January 27, 2024, respectively. Interest expense related to unrecognized tax benefits for the Company was $1.7 million during fiscal 2025 and was not material for fiscal 2024 and fiscal 2023.

A summary of unrecognized tax benefits is as follows (dollars in thousands):
Fiscal Year Ended
January 25, 2025January 27, 2024January 28, 2023
Balance at beginning of year$17,606 $15,771 $11,929 
Additions based on tax positions related to the fiscal year2,682 1,884 2,042 
Additions based on tax positions related to prior years1,369 587 2,957 
Reductions based on tax positions related to prior years(94)(636)— 
Reductions related to the expiration of statutes of limitation— — (1,157)
Balance at end of year$21,563 $17,606 $15,771