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INCOME TAXES

12 Months Ended

Dec. 25, 2021

INCOME TAXES

J.INCOME TAXES

Income tax provisions for the years ended December 25, 2021, December 26, 2020, and December 28, 2019 are summarized as follows (in thousands):

​	​	​	​	​	​	​	​	​	​
​		2021		​	2020			2019
Currently Payable:		​			​			​
Federal	​	$	115,077	​	$	59,055	​	$	35,267
State and local	​		30,441	​		16,709	​		10,071
Foreign	​		21,095	​		8,601	​		5,834
​	​		166,613	​		84,365	​		51,172
Net Deferred:	​			​			​
Federal	​		6,242	​		2,292	​		6,895
State and local	​		118	​		(1,518)	​		805
Foreign	​		999	​		1,962	​		(602)
​	​		7,359	​		2,736	​		7,098
Total income tax expense	​	$	173,972	​	$	87,101	​	$	58,270

​

The components of earnings before income taxes consist of the following:

​

​	​	​	​	​	​	​	​	​	​
​		2021			2020			2019
U.S.	​	$	645,316	​	$	308,167	​	$	220,532
Foreign	​		81,020	​		32,816	​		20,142
Total	​	$	726,336	​	$	340,983	​	$	240,674

​

The effective income tax rates are different from the statutory federal income tax rates for the following reasons:

​

​	​	​	​	​	​	​	​
​		2021		2020		2019
Statutory federal income tax rate		21.0	%	21.0	%	21.0	%
State and local taxes (net of  federal benefits)		3.3		3.4		3.9	​
Effect of noncontrolling owned interest in earnings of partnerships		n/a		n/a		(0.1)	​
Tax credits, including foreign tax credit		(0.6)		(0.9)		(1.3)	​
Change in uncertain tax positions reserve		(0.1)		(0.1)		(0.1)	​
Other permanent differences		(0.4)		0.6		0.5	​
Other, net		0.7		1.5		0.3	​
Effective income tax rate		23.9	%	25.5	%	24.2	%

​

Temporary differences which give rise to deferred income tax assets and (liabilities) on December 25, 2021 and December 26, 2020 are as follows (in thousands):

​	​	​	​	​	​	​
​		2021			2020
Employee benefits	​	$	27,543	​	$	23,236
Lease liability	​	​	24,627	​	​	19,376
Net operating loss carryforwards	​		5,502	​		6,463
Foreign subsidiary capital loss carryforward	​		527	​		527
Other tax credits	​		450	​		391
Inventory	​		2,007	​		1,633
Reserves on receivables	​		1,446	​		1,630
Accrued expenses	​		5,735	​		3,071
Other, net	​		5,233	​		8,483
Gross deferred income tax assets	​		73,070	​		64,810
Valuation allowance	​		(3,952)	​		(4,044)
Deferred income tax assets	​		69,118	​		60,766
Depreciation	​		(64,387)	​		(41,403)
Intangibles	​		(38,367)	​		(22,840)
Right of use assets	​	​	(23,866)	​	​	(19,376)
Deferred income tax liabilities	​		(126,620)	​		(83,619)
Net deferred income tax liability	​	$	(57,502)	​	$	(22,853)

​

As of December 25, 2021, we had federal, state and foreign net operating loss carryforwards of $5.5 million and state tax credit carryforwards of $0.5 million, which will expire at various dates.

The NOL and credit carryforwards expire as follows:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Net Operating Losses

​

Tax Credits

​

U.S.

State

Foreign

U.S.

State

2022 - 2026

​

$

—

​

$

—

​

$

536

​

$

—

​

$

—

2027 - 2031

​

—

​

​

436

​

​

1,424

​

—

​

—

2032 - 2036

​

—

​

​

670

​

​

106

​

—

​

450

2037 - 2041

​

790

​

​

808

​

​

—

​

—

​

—

Thereafter

​

—

​

​

438

​

​

294

​

—

​

—

Total

​

$

790

​

$

2,352

​

$

2,360

​

$

—

​

$

450

​

As of December 25, 2021, we believe that it is more likely than not that the benefit from certain state and foreign NOL carryforwards will not be realized. In recognition of this risk, we have provided a valuation allowance of $3.4 million against the various NOLs. Furthermore, there is a valuation allowance of $0.5 million against a capital loss carryforward we have for a wholly-owned subsidiary, UFP Canada, Inc. Based upon the business activity and the nature of the assets of this subsidiary, our ability to realize a future benefit from this carryforward is doubtful. The capital loss has an unlimited carryforward and therefore will not expire unless there is a change in control of the subsidiary.

X

- 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
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-Section S99
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
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-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
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-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
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-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

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