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Income Taxes | 12 Months Ended
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Mar. 30, 2019
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes Income before income taxes consisted of (in thousands):
|  | Fiscal Years Ended
|  | March 30, 2019 |  | March 31, 2018 |  | March 25, 2017
U.S. |  | $ | 41,980 |  |  | $ | 91,220 |  |  | $ | 137,654 |
Non-U.S. |  | 51,764 |  |  | 173,879 |  |  | 177,393 |
|  | $ | 93,744 |  |  | $ | 265,099 |  |  | $ | 315,047 |
The provision (benefit) for income taxes consists of (in thousands):
|  | Fiscal Years Ended
|  | March 30, 2019 |  | March 31, 2018 |  | March 25, 2017
Current: |  |  |  |  |  |
U.S. |  | $ | (7,109 | ) |  | $ | 66,082 |  |  | $ | 28,940 |
Non-U.S. |  | 12,428 |  |  | 21,812 |  |  | 7,234 |
Total current tax provision |  | $ | 5,319 |  |  | $ | 87,894 |  |  | $ | 36,174 |
Deferred: |  |  |  |  |  |
U.S. |  | 5,441 |  |  | 19,309 |  |  | 2,576 |
Non-U.S. |  | (7,007 | ) |  | (4,099 | ) |  | 15,088 |
Total deferred tax provision |  | (1,566 | ) |  | 15,210 |  |  | 17,664 |
Total tax provision |  | $ | 3,753 |  |  | $ | 103,104 |  |  | $ | 53,838 |
The effective income tax rates differ from the rates computed by applying the statutory federal rate to pretax income as follows (in percentages):
|  | Fiscal Years Ended
|  | March 30, 2019 |  | March 31, 2018 |  | March 25, 2017
U.S. federal statutory rate |  | 21.0 |  |  | 31.6 |  |  | 35.0 |
Foreign income taxed at different rates |  | (2.9 | ) |  | (9.6 | ) |  | (8.7 | )
Transition tax on deferred foreign income |  | (11.8 | ) |  | 20.3 |  |  | — |
Remeasurement of U.S. deferred tax balance |  | (0.1 | ) |  | 2.3 |  |  | — |
Research and development tax credits |  | (6.7 | ) |  | (2.5 | ) |  | (1.8 | )
Stock-based compensation |  | (1.0 | ) |  | (4.5 | ) |  | (7.3 | )
Foreign-derived intangible income deduction |  | (2.8 | ) |  | — |  |  | — |
Current U.S. tax on foreign earnings |  | 2.2 |  |  | 0.7 |  |  | 0.1 |
Change in valuation allowance |  | 4.4 |  |  | — |  |  | — |
Interest related to unrecognized tax benefits |  | 1.6 |  |  | — |  |  | — |
Other |  | 0.1 |  |  | 0.6 |  |  | (0.2 | )
Effective tax rate |  | 4.0 |  |  | 38.9 |  |  | 17.1 |
The Tax Cuts and Jobs Act (the "Tax Act") was enacted on December 22, 2017. The Tax Act reduced the U.S. federal corporate tax rate from 35% to 21%, restricted the deductibility of certain business expenses, required companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax-deferred, and created new taxes on certain foreign sourced earnings, among other provisions. In fiscal year 2018 and the first six months of fiscal year 2019, we recorded provisional amounts for certain enactment-date effects of the Tax Act by applying the guidance in SEC Staff Accounting Bulletin No. 118 ("SAB 118") because we had not yet completed our enactment-date accounting for these effects. In fiscal year 2018, the Company recorded provisional amounts related to the enactment-date effects of the Tax Act that included recording the one-time transition tax liability related to undistributed earnings of certain foreign subsidiaries that were not previously taxed and the revaluation of certain deferred tax assets and liabilities. In fiscal year 2019, certain discrete adjustments to the provisional amounts were recorded. Our accounting for the enactment-date effects of the Tax Act was completed during the quarter ended December 29, 2018. The changes to the fiscal year 2018 enactment-date provisional amounts decreased the effective tax rate in fiscal year 2019 by 11.9%. We applied the guidance in SAB 118 when accounting for the enactment-date effects of the Tax Act under ASC 740, Income Taxes, for the following aspects: remeasurement of deferred tax assets and liabilities, one-time transition tax, and tax on global intangible low taxed income ("GILTI"). As further discussed below, during the first nine months of fiscal year 2019 we recognized adjustments of $11.1 million that decreased the enactment-date provisional amounts recorded at March 31, 2018. The one-time transition tax represents the tax on our total post-1986 earnings and profits, which was previously deferred from U.S. income taxes under prior U.S. law. We recorded a provisional amount for our one-time transition tax liability for each of our foreign subsidiaries, resulting in a transition tax liability of $53.9 million at March 31, 2018. Upon further analysis of the Tax Act, subsequent Internal Revenue Service ("IRS") guidance, and regulations proposed by the U.S. Department of the Treasury and the IRS, we finalized our calculations of the transition tax liability during the third quarter of fiscal year 2019. We recognized a decrease of $11.0 million to the transition tax provisional amount in fiscal year 2019, which is included as a component of income tax expense from continuing operations. We have elected to pay our transition tax over the eight-year period provided in the Tax Act. As of March 30, 2019, the remaining balance of our transition tax obligation is $27.0 million, which will be paid over the next seven years. We remeasured certain deferred tax assets and liabilities based on the rates at which they were expected to reverse in the future, which was generally 21%, by recording a provisional amount of $6.1 million at March 31, 2018. We finalized our calculations and recognized a decrease of $0.1 million to our provisional amount in fiscal year 2019, which is included as a component of income tax expense from continuing operations. The Tax Act subjects a U.S. shareholder to current tax on certain earnings of foreign subsidiaries under a provision commonly known as GILTI. Under U.S. GAAP, an accounting policy election can be made to either recognize deferred taxes for temporary basis differences expected to reverse as GILTI in future years, or to provide for the tax expense related to GILTI in the year the tax is incurred as a period expense only. We have elected to account for GILTI in the year the tax is incurred. The transition to a territorial tax system under the Tax Act means that the taxation of future dividend distributions by foreign subsidiaries is expected to be limited to withholding taxes that may apply based on the jurisdiction of the subsidiary. As of March 30, 2019, unremitted earnings from our foreign subsidiaries are not expected to be indefinitely reinvested. No taxes have been accrued for foreign withholding taxes on these earnings as these amounts are not material. We have not provided additional income taxes for any other outside basis differences inherent in these entities, as these amounts continue to be indefinitely reinvested in foreign operations. Determining the amount of unrecognized deferred tax liability related to all other outside basis differences in these entities is not practicable at this time. Significant components of our deferred tax assets and liabilities as of March 30, 2019 and March 31, 2018 are (in thousands):
|  | March 30, 2019 |  | March 31, 2018
Deferred tax assets: |  |  |  |
Accrued expenses and allowances |  | $ | 4,024 |  |  | $ | 5,793 |
Net operating loss carryforwards |  | 2,940 |  |  | 3,646 |
Research and development tax credit carryforwards |  | 13,111 |  |  | 12,701 |
Stock-based compensation |  | 14,667 |  |  | 14,156 |
Other |  | 1,261 |  |  | 2,402 |
Total deferred tax assets |  | $ | 36,003 |  |  | $ | 38,698 |
Valuation allowance for deferred tax assets |  | (18,588 | ) |  | (14,671 | )
Net deferred tax assets |  | $ | 17,415 |  |  | $ | 24,027 |
Deferred tax liabilities: |  |  |  |
Depreciation and amortization |  | $ | 8,913 |  |  | $ | 9,184 |
Acquisition intangibles |  | 8,803 |  |  | 13,427 |
Total deferred tax liabilities |  | $ | 17,716 |  |  | $ | 22,611 |
Total net deferred tax assets (liabilities) |  | $ | (301 | ) |  | $ | 1,416 |
Deferred tax assets and liabilities are recorded for the estimated tax impact of temporary differences between the tax basis and book basis of assets and liabilities. A valuation allowance is established against a deferred tax asset when it is more likely than not that the deferred tax asset will not be realized. Our valuation allowance increased by $3.9 million in fiscal year 2019, which included a decrease of $0.2 million with no effect on tax expense and a net increase of $4.1 million which affected tax expense. The Company maintains a valuation allowance for certain deferred tax assets primarily relating to certain U.S. federal tax deductions, state net operating loss carryforwards, and state tax credit carryforwards due to the likelihood that they will expire or go unutilized. Management believes that the Company’s results from future operations will generate sufficient taxable income in the appropriate jurisdictions and of the appropriate character such that it is more likely than not that the remaining deferred tax assets will be realized. At March 30, 2019, the Company had gross federal net operating loss carryforwards of $9.2 million, all of which related to acquired companies and are, therefore, subject to certain limitations under Section 382 of the Internal Revenue Code. The federal net operating loss carryforwards expire in fiscal years 2020 through 2031. At March 30, 2019, the Company had gross state net operating loss carryforwards of $22.2 million. The state net operating loss carryforwards expire in fiscal years 2020 through 2029. In addition, the Company had $13.4 million of state business tax, minimum tax, and research and development tax credit carryforwards. Certain of these state tax credits will expire in fiscal years 2021 through 2034. The remaining state tax credit carryforwards do not expire. The following table summarizes the changes in the unrecognized tax benefits (in thousands):
|  | March 30, 2019 |  | March 31, 2018
Beginning balance |  | $ | 55,164 |  |  | $ | 30,858 |
Additions based on tax positions related to the current year |  | 2,204 |  |  | 26,602 |
Reductions based on tax positions related to the prior years |  | (17,622 | ) |  | (2,296 | )
Ending balance |  | $ | 39,746 |  |  | $ | 55,164 |
The Company records unrecognized tax benefits for the estimated risk associated with tax positions taken on tax returns. At March 30, 2019, the Company had gross unrecognized tax benefits of $39.7 million, all of which would impact the effective tax rate if recognized. During fiscal year 2019, the Company had gross increases of $2.2 million related to current year unrecognized tax positions, as well as gross decreases of $17.6 million related to prior year unrecognized tax positions. The Company’s unrecognized tax benefits are classified as “Non-current income taxes” in the Consolidated Balance Sheet. The Company recognizes interest and penalties related to unrecognized tax benefits in the provision for income taxes. During fiscal years 2019 and 2018 we recognized interest expense, net of tax, of approximately $1.5 million and $0.8 million, respectively. The Company and its subsidiaries are subject to U.S. federal income tax as well as income tax in multiple state and foreign jurisdictions. Fiscal years 2016 through 2019 remain open to examination by the major taxing jurisdictions to which the Company is subject, although carry forward attributes that were generated in tax years prior to fiscal year 2016 may be adjusted upon examination by the tax authorities if they have been, or will be, used in a future period. The Company's United Kingdom subsidiaries are currently under a limited scope tax audit for certain income tax matters related to fiscal years 2016 and 2017. The Company's fiscal year 2017 federal income tax return is under examination by the U.S. Internal Revenue Service. The Company believes it has accrued adequate reserves related to the matters under examination. The Company is not under an income tax audit in any other major taxing jurisdiction.

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