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Income Taxes
 12 Months Ended
Jun. 27, 2024
Income Tax Disclosure [Abstract]  
Income Taxes

NOTE 9 — INCOME TAXES

The provision for income taxes is based entirely on income before income taxes earned in the United States, and is as follows for the last three fiscal years:

 

For the Year Ended

 

 

June 27,
2024

 

 

June 29,
2023

 

 

June 30,
2022

 

Current:

 

 

 

 

 

 

 

 

 

Federal

 

$

15,405

 

 

$

18,393

 

 

$

14,347

 

State

 

 

4,987

 

 

 

5,215

 

 

 

5,011

 

Total current expense

 

 

20,392

 

 

 

23,608

 

 

 

19,358

 

Deferred:

 

 

 

 

 

 

 

 

 

Deferred federal

 

 

209

 

 

 

(1,164

)

 

 

1,519

 

Deferred state

 

 

(913

)

 

 

49

 

 

 

(968

)

Total deferred (benefit) expense

 

 

(704

)

 

 

(1,115

)

 

 

551

 

Total income tax expense

 

$

19,688

 

 

$

22,493

 

 

$

19,909

 

 

The reconciliations of income taxes at the statutory federal income tax rate to income tax expense reported in the Consolidated Statements of Comprehensive Income for the last three fiscal years are as follows:

 

June 27,
2024

 

 

June 29,
2023

 

 

June 30,
2022

 

Federal statutory income tax rate

 

 

21.0

%

 

 

21.0

%

 

 

21.0

%

State income taxes, net of federal benefit

 

 

3.8

 

 

 

4.9

 

 

 

3.7

 

Section 162(m) limitation

 

 

1.4

 

 

 

0.7

 

 

 

0.6

 

Research and development tax credit

 

 

(0.9

)

 

 

(0.3

)

 

 

(0.4

)

Bargain purchase gain

 

 

(0.6

)

 

 

—

 

 

 

—

 

Share-based compensation

 

 

(0.4

)

 

 

0.1

 

 

 

(0.7

)

Uncertain tax positions

 

 

0.2

 

 

 

0.1

 

 

 

0.1

 

Other

 

 

0.1

 

 

 

(0.1

)

 

 

0.1

 

Effective tax rate

 

 

24.6

%

 

 

26.4

%

 

 

24.4

%

 

Deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial statement basis and the tax basis of assets and liabilities using enacted statutory tax rates applicable to future years. Deferred tax assets and liabilities are comprised of the following:

 

June 27,
2024

 

 

June 29,
2023

 

Deferred tax assets (liabilities):

 

 

 

 

 

 

Accounts receivable

 

$

417

 

 

$

346

 

Employee compensation

 

 

2,343

 

 

 

1,866

 

Inventory

 

 

460

 

 

 

371

 

Depreciation

 

 

(16,466

)

 

 

(14,303

)

Capitalized leases

 

 

1,115

 

 

 

1,140

 

Goodwill and intangible assets

 

 

797

 

 

 

1,474

 

Retirement plan

 

 

6,716

 

 

 

7,004

 

Workers’ compensation

 

 

1,663

 

 

 

1,950

 

Share based compensation

 

 

1,780

 

 

 

1,642

 

Research related expenditures

 

 

3,505

 

 

 

1,549

 

Other

 

 

800

 

 

 

553

 

Net deferred tax asset

 

$

3,130

 

 

$

3,592

 

 

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income of the character necessary during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities (including the impact of available carryback and carryforward periods), projected future taxable income and tax-planning strategies in making this assessment. If or when recognized, the tax benefits relating to any reversal of the valuation allowance will be recognized as a reduction of income tax expense.

For the years ending June 27, 2024 and June 29, 2023, unrecognized tax benefits and accrued interest and penalties were $692 and $448. Accrued interest and penalties related to uncertain tax positions are not material for any periods presented. Interest and penalties within income tax expense were not material for any period presented. The total gross amounts of unrecognized tax benefits were $733 and $463 at June 27, 2024 and June 29, 2023, respectively.

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows:

 

June 27,
2024

 

 

June 29,
2023

 

 

June 30,
2022

 

Beginning balance

 

$

463

 

 

$

390

 

 

$

326

 

Gross increases — tax positions in prior year

 

 

146

 

 

 

32

 

 

 

1

 

Settlements

 

 

(104

)

 

 

(36

)

 

 

—

 

Gross increases — tax positions in current year

 

 

311

 

 

 

127

 

 

 

110

 

Lapse of statute of limitations

 

 

(83

)

 

 

(50

)

 

 

(47

)

Ending balance

 

$

733

 

 

$

463

 

 

$

390

 

 

Unrecognized tax benefits, that if recognized, would affect the annual effective tax rate on income from continuing operations, are as follows:

 

June 27,
2024

 

 

June 29,
2023

 

 

June 30,
2022

 

Unrecognized tax benefits that would affect annual effective
   tax rate

 

$

682

 

 

$

439

 

 

$

373

 

 

During fiscal 2024, the change in unrecognized tax benefits due to statute expiration was not material. We do not anticipate that total unrecognized tax benefits will significantly change in the next twelve months.

We file income tax returns with federal and state tax authorities within the United States of America. Our federal tax returns are open for audit for fiscal 2021 through 2023. Our Illinois tax return is under audit for fiscal 2022. Our Illinois tax return for fiscal 2023 is open for audit. Our California tax returns for fiscal 2020 through 2023 are open for audit. No other tax jurisdictions are material to us.