XML 26 R17.htm IDEA: XBRL DOCUMENT v3.23.3
INCOME TAXES
 9 Months Ended
Sep. 24, 2023
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
The Company’s entire pretax loss for the thirteen and thirty-nine weeks ended September 24, 2023 and September 25, 2022 was from its U.S domestic operations. The Company’s tax provision for interim periods is determined using an estimate of its annual effective tax rate, adjusted for discrete items arising during interim periods. For the thirteen and thirty-nine weeks ended September 24, 2023 there were no significant discrete items recorded and the Company recorded $0.3 million and $1.0 million in income taxes, respectively. For the thirteen and thirty-nine weeks ended September 25, 2022 there were no significant discrete items recorded and the Company recorded less than $0.1 million in income tax expense, respectively.

On March 27, 2020, President Trump signed into law the CARES Act (as defined below). Intended to provide economic relief to those impacted by the COVID-19 pandemic, the CARES Act includes provisions, among others, to enhance business’ liquidity and provide for refundable employee retention tax credits, which could be used to offset payroll tax liabilities. On March 11, 2021, President Biden signed the American Rescue Plan Act (“ARPA”). The ARPA includes several provisions, such as measures that extend and expand the employee retention credit, previously enacted under the CARES Act, through September 30, 2021. As there is no authoritative guidance under U.S. GAAP on accounting for government assistance to for-profit business entities, the Company accounts for the ERC (as defined below) by analogy to International Accounting Standard ("IAS”) 20, Accounting for Government Grants and Disclosure of Government Assistance. In accordance with IAS 20, management determined it has reasonable assurance for receipt of the ERC and recorded the ERC benefit of $1.8 million within Labor and other related expenses and $5.1 million, within general and administrative expenses in the Condensed Consolidated Statement of Operations for the thirty-nine weeks ended September 24, 2023 as an offset to Social Security tax expense. As of September 24, 2023 the Company received $3.4 million cash payment reducing the ERC receivable within other current assets on the Condensed Consolidated Balance Sheet to $3.6 million.

On August 16, 2022, President Biden signed the Inflation Reduction Act of 2022 (“IRA”) into law. The IRA contains several revisions to the Internal Revenue Code, including a 15% corporate minimum income tax for entities with adjusted financial statement income of over $1.0 billion and a 1% excise tax on corporate stock repurchases in tax years beginning after December 31, 2022. These tax law changes did not have a material effect on the Company’s results of operations.