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Income Taxes | 12 Months Ended
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Dec. 30, 2017
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The components of income before provision for income taxes are as follows (in thousands):
| Year ended December 30, 2017 |  | Year ended December 31, 2016 |  | Year ended January 2, 2016
United States | $ | 171,564 |  |  | $ | 320,702 |  |  | $ | 87,762 |
Foreign | 27,810 |  |  | 97,639 |  |  | 28,583 |
Total | $ | 199,374 |  |  | $ | 418,341 |  |  | $ | 116,345 |
The following table presents the current and deferred provision (benefit) for income taxes (in thousands):
| Year ended December 30, 2017 |  | Year ended December 31, 2016 |  | Year ended January 2, 2016
Current: |  |  |  |  |
Federal | $ | 38,777 |  |  | $ | 99,533 |  |  | $ | 31,983 |
State | 1,940 |  |  | 6,922 |  |  | 2,388 |
Foreign | 3,018 |  |  | 5,815 |  |  | 2,448 |
| 43,735 |  |  | 112,270 |  |  | 36,819 |
Deferred: |  |  |  |  |
Federal | 27,002 |  |  | 2,982 |  |  | (900 | )
State | (3,001 | ) |  | 2,331 |  |  | (1,206 | )
Foreign | 22 |  |  | 92 |  |  | 132 |
| 24,023 |  |  | 5,405 |  |  | (1,974 | )
Total | $ | 67,758 |  |  | $ | 117,675 |  |  | $ | 34,845 |
Included in the fiscal year 2017, 2016 and 2015 current tax provisions are net increases of $1.6 million, $6.1 million and $0.6 million, respectively, for tax and accrued interest related to uncertain tax positions for each fiscal year. The reconciliation of the U.S. federal statutory tax rate to the Company’s effective tax rate is as follows:
| Year ended December 30, 2017 |  | Year ended December 31, 2016 |  | Year ended January 2, 2016
Statutory regular federal income tax rate | 35.0 | % |  | 35.0 | % |  | 35.0 | %
State provision, net of federal benefit | (0.3 | ) |  | 1.4 |  |  | 0.7 |
Nondeductible items | 1.8 |  |  | 0.8 |  |  | 1.7 |
Foreign income taxed at different rates | (3.4 | ) |  | (5.6 | ) |  | (6.3 | )
Tax credits | (2.0 | ) |  | (0.5 | ) |  | (1.7 | )
Change in federal valuation allowance | — |  |  | — |  |  | 0.4 |
Impact of 2017 Tax Act | 18.5 |  |  | — |  |  | — |
Withholding taxes on undistributed foreign earnings | 3.3 |  |  | — |  |  | — |
Excess stock based compensation | (18.9 | ) |  | (3.0 | ) |  | — |
Other | — |  |  | — |  |  | 0.2 |
Total | 34.0 | % |  | 28.1 | % |  | 30.0 | %
The 2017 Tax Act significantly changed the U.S. corporate income tax system. The changes included, among other things, a one-time transition tax on the “deemed repatriation” of cumulative undistributed foreign earnings as of December 31, 2017, and a permanent reduction of the federal corporate income tax rate from 35% to 21% effective January 1, 2018. Under GAAP, the effect of a change in tax rate or tax law is accounted for in the period of enactment and deferred assets and liabilities are measured at the enacted tax rate. On December 22, 2017, the SEC issued Staff Accounting Bulletin No. 118 (SAB 118) to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the 2017 Tax Act and provides for a measurement period of one year from the enactment date to finalize the accounting for effects of the 2017 Tax Act. The Company has calculated its best estimate of the tax impact related to the 2017 Tax Act and recorded a provisional expense of $43.5 million, of which $9.0 million relates to the re-measurement of deferred taxes due to the reduction in the federal corporate tax rate, $28.0 million relates to the transition tax on the deemed repatriation of foreign earnings, and $6.5 million relates to estimated foreign withholding taxes, net of estimated foreign tax credit benefit, and state income taxes related to the Company’s decision to repatriate up to $180.0 million of accumulated undistributed foreign earnings to the U.S. in the future. As of December 30, 2017, the Company had approximately $217.4 million of cumulative undistributed earnings subject to the transition tax. The Company has recorded provisional foreign withholding and state taxes, net of estimated foreign tax credits, of $6.5 million with respect to $180.0 million of cumulative undistributed earnings that the Company has tentatively decided are no longer permanently reinvested. The Company currently considers the remaining undistributed earnings of $37.4 million to continue to be indefinitely reinvested and has not recorded any incremental foreign withholding or state taxes related to such amount. If the Company decided to distribute such permanently reinvested earnings, the Company would accrue estimated additional income tax expense of up to $1.9 million. In accordance with SAB 118, the ultimate impact of the 2017 Tax Act may differ, possibly materially, due to, among other things, refinement of the underlying calculation or earnings and profits, changes in underlying interpretations and assumptions the Company has made, additional regulatory guidance that may be issued and other actions the Company may take as a result of the 2017 Tax Act. In addition, and in light of the 2017 Tax Act, the Company is still evaluating its indefinite reinvestment assertion with respect to its cumulative undistributed earnings and considers its current conclusion related thereto to be incomplete in accordance with SAB 118. The Company expects to complete its accounting for the implementation of the 2017 Tax Act no later than the time that the 2017 U.S. corporate income tax return is filed in 2018. Any subsequent adjustments to the amounts that have been provisionally accrued will be recorded to tax expense during the quarter within the measurement period when the analysis is completed. The components of the deferred tax assets are as follows (in thousands):
| December 30, 2017 |  | December 31, 2016
Deferred tax assets: |  |  |
Tax credits | $ | 6,414 |  |  | $ | 802 |
Deferred revenue | 3,831 |  |  | 5,393 |
Accrued liabilities | 9,414 |  |  | 16,244 |
Stock-based compensation | 8,601 |  |  | 18,680 |
Other | 237 |  |  | 1,902 |
Total | 28,497 |  |  | 43,021 |
Valuation allowance | — |  |  | — |
Total deferred tax assets | 28,497 |  |  | 43,021 |
Deferred tax liabilities: |  |  |
Property and equipment | (2,988 | ) |  | (2,691 | )
State taxes and other | (1,990 | ) |  | (1,695 | )
Withholding taxes on undistributed foreign earnings | (9,500 | ) |  | — |
Total deferred tax liabilities | (14,478 | ) |  | (4,386 | )
Net deferred tax assets | $ | 14,019 |  |  | $ | 38,635 |
As of December 30, 2017, the Company has $3.6 million of net operating losses from various states, which will begin to expire in 2023. The Company also has state research and development tax credits of $6.3 million that will carry forward indefinitely and $0.4 million of Canadian investment tax credits on research and development expenditures that will begin to expire in 2031. The Company believes that it is more likely than not that the deferred tax assets related to these carryforwards will be realized. In making this determination, the Company considered all available positive and negative evidence, including scheduled reversals of liabilities, projected future taxable income, tax planning strategies and recent financial performance. As a result of certain business and employment actions undertaken by the Company, income earned in a certain European country is subject to a reduced tax rate through 2018 as the Company has met certain employment thresholds. For the years ended December 30, 2017, December 31, 2016 and January 2, 2016, the estimated income tax benefit related to such business arrangement was $1.0 million, $4.6 million and $1.3 million, respectively, and favorably impacted net income per diluted share by $0.02, $0.09 and $0.02, respectively. The following is a tabular reconciliation of the total amounts of unrecognized tax benefits (in thousands):
| Year ended December 30, 2017 |  | Year ended December 31, 2016
Unrecognized tax benefits (gross), beginning of period | $ | 14,494 |  |  | $ | 8,875 |
Amounts related to Cercacor from prior year | — |  |  | (277 | )
Increase from tax positions in prior period | 498 |  |  | 143 |
Increase from tax positions in current period | 2,142 |  |  | 6,437 |
Settlements | — |  |  | (296 | )
Lapse of statute of limitations | (977 | ) |  | (388 | )
Unrecognized tax benefits (gross), end of period | $ | 16,157 |  |  | $ | 14,494 |
The amount of unrecognized benefits which, if ultimately recognized, could favorably affect the tax rate in a future period was $14.5 million and $13.1 million as of December 30, 2017 and December 31, 2016, respectively. It is reasonably possible that the amount of unrecognized tax benefits in various jurisdictions may change in the next 12 months due to the expiration of statutes of limitation and audit settlements. However, due to the uncertainty surrounding the timing of these events, an estimate of the change within the next 12 months cannot be made at this time. For the years ended December 30, 2017, December 31, 2016 and January 2, 2016, the Company accrued $0.3 million, $0.1 million and $0.2 million, respectively, for interest and penalties related to unrecognized tax benefits as part of income tax expense. Total accrued interest and penalties related to unrecognized tax benefits as of December 30, 2017 and December 31, 2016 were $1.6 million and $1.2 million, respectively. The Company conducts business in multiple jurisdictions, and as a result, one or more of the Company’s subsidiaries files income tax returns in the U.S. federal, various state, local and foreign jurisdictions. The Company has concluded all U.S. federal income tax matters for years through 2013. All material state, local and foreign income tax matters have been concluded for years through 2010. The Company does not believe that the results of any tax authority examination would have a significant impact on its financial statements.

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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/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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