XML 33 R21.htm IDEA: XBRL DOCUMENT v3.25.2
Income Taxes
 12 Months Ended
Jun. 26, 2025
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 26,
2025

 

 

June 27,
2024

 

 

June 29,
2023

 

Current:

 

 

 

 

 

 

 

 

 

Federal

 

$

16,736

 

 

$

15,405

 

 

$

18,393

 

State

 

 

4,687

 

 

 

4,987

 

 

 

5,215

 

Total current expense

 

 

21,423

 

 

 

20,392

 

 

 

23,608

 

Deferred:

 

 

 

 

 

 

 

 

 

Deferred federal

 

 

(2,009

)

 

 

209

 

 

 

(1,164

)

Deferred state

 

 

(483

)

 

 

(913

)

 

 

49

 

Total deferred tax benefit

 

 

(2,492

)

 

 

(704

)

 

 

(1,115

)

Total income tax expense

 

$

18,931

 

 

$

19,688

 

 

$

22,493

 

 

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 26,
2025

 

 

June 27,
2024

 

 

June 29,
2023

 

Federal statutory income tax rate

 

 

21.0

%

 

 

21.0

%

 

 

21.0

%

State income taxes, net of federal benefit

 

 

4.1

 

 

 

3.8

 

 

 

4.9

 

Section 162(m) limitation

 

 

0.2

 

 

 

1.4

 

 

 

0.7

 

Research and development tax credit

 

 

(1.0

)

 

 

(0.9

)

 

 

(0.3

)

Bargain purchase gain

 

 

—

 

 

 

(0.6

)

 

 

—

 

Share-based compensation

 

 

(0.1

)

 

 

(0.4

)

 

 

0.1

 

Uncertain tax positions

 

 

0.3

 

 

 

0.2

 

 

 

0.1

 

Other

 

 

(0.2

)

 

 

0.1

 

 

 

(0.1

)

Effective tax rate

 

 

24.3

%

 

 

24.6

%

 

 

26.4

%

 

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 26,
2025

 

 

June 27,
2024

 

Deferred tax assets (liabilities):

 

 

 

 

 

 

Accounts receivable

 

$

405

 

 

$

417

 

Employee compensation

 

 

2,558

 

 

 

2,343

 

Inventory

 

 

621

 

 

 

460

 

Depreciation

 

 

(15,902

)

 

 

(16,466

)

Capitalized leases

 

 

1,064

 

 

 

1,115

 

Goodwill and intangible assets

 

 

240

 

 

 

797

 

Retirement plan

 

 

7,185

 

 

 

6,716

 

Workers’ compensation

 

 

1,746

 

 

 

1,663

 

Share based compensation

 

 

2,085

 

 

 

1,780

 

Research related expenditures

 

 

5,035

 

 

 

3,505

 

Other

 

 

745

 

 

 

800

 

Net deferred tax asset

 

$

5,782

 

 

$

3,130

 

 

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 26, 2025 and June 27, 2024, unrecognized tax benefits and accrued interest and penalties were $780 and $692. 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 $807 and $733 at June 26, 2025 and June 27, 2024, respectively.

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

 

June 26,
2025

 

 

June 27,
2024

 

 

June 29,
2023

 

Beginning balance

 

$

733

 

 

$

463

 

 

$

390

 

Gross increases — tax positions in prior year

 

 

52

 

 

 

146

 

 

 

32

 

Settlements

 

 

(141

)

 

 

(104

)

 

 

(36

)

Gross increases — tax positions in current year

 

 

251

 

 

 

311

 

 

 

127

 

Lapse of statute of limitations

 

 

(88

)

 

 

(83

)

 

 

(50

)

Ending balance

 

$

807

 

 

$

733

 

 

$

463

 

 

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

 

June 26,
2025

 

 

June 27,
2024

 

 

June 29,
2023

 

Unrecognized tax benefits that would affect annual effective
   tax rate

 

$

770

 

 

$

682

 

 

$

439

 

 

During fiscal 2025, 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 2022 through 2024. Our Illinois tax returns for fiscal 2023 and 2024 are under audit. Our California tax returns for fiscal 2021 through 2024 are open for audit. No other tax jurisdictions are material to us.

The One, Big, Beautiful Bill Act (the “Act”) was signed into law on July 4, 2025. The Act contains significant tax law changes with various effective dates affecting business taxpayers. Among the tax law changes that will impact the Company relate to the timing of certain tax deductions including depreciation expense and research and development expenditures. The Company will implement the Act’s tax law changes in the first quarter of fiscal 2026. The Company does not anticipate any impact to its overall tax expense, but the Act will impact the allocation of tax expense between current and deferred.