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Income Taxes | 12 Months Ended
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Dec. 29, 2016
Income Taxes [Abstract] |
Income Taxes | 9. Income Taxes The components of the net deferred tax liability are as follows:
|  | December 29, 2016 |  | December 31, 2015 |
|  | (in thousands) |
Accrued employee benefits |  | $ | 17,682 |  | $ | 17,218 |
Depreciation and amortization |  |  | (67,897) |  |  | (63,906) |
Other |  |  | 3,782 |  |  | 3,283 |
Net deferred tax liability |  | $ | (46,433) |  | $ | (43,405) |
During fiscal 2016, the Company adopted ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes, which simplifies the presentation of deferred income taxes by requiring that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as noncurrent on the balance sheet. The new guidance was applied on a retrospective basis to all prior periods. Accordingly, $2,807,000 of deferred income taxes (current asset) have been reclassified as a reduction of deferred income taxes (long term liability) on the December 31, 2015 consolidated balance sheet. Income tax expense consists of the following:
|  | Year Ended |  | 31 Weeks Ended |  | Year Ended |
|  | December 29, 2016 |  | December 31, 2015 |  | May 28, 2015 |  | May 29, 2014 |
|  | (in thousands) |
Current: |  |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 15,434 |  | $ | 12,688 |  | $ | 8,065 |  | $ | 14,788 |
State |  |  | 4,667 |  |  | 3,240 |  |  | 2,120 |  |  | 2,654 |
Deferred: |  |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | 3,402 |  |  | (829) |  |  | 4,328 |  |  | (861) |
State |  |  | (509) |  |  | (314) |  |  | 1,165 |  |  | 229 |
|  | $ | 22,994 |  | $ | 14,785 |  | $ | 15,678 |  | $ | 16,810 |
The Company’s effective income tax rate, adjusted for earnings from noncontrolling interests, for fiscal 2016, the Transition Period, fiscal 2015 and fiscal 2014 was 37.8%, 38.6%, 39.5% and 40.2%, respectively. The Company has not included the income tax expense or benefit related to the net earnings or loss attributable to noncontrolling interest in its income tax expense as the entities are considered pass-through entities and, as such, the income tax expense or benefit is attributable to its owners. A reconciliation of the statutory federal tax rate to the effective tax rate on earnings attributable to The Marcus Corporation follows:
|  | Year Ended |  | 31 Weeks Ended |  | Year Ended |
|  | December 29, 2016 |  | December 31, 2015 |  | May 28, 2015 |  | May 29, 2014 |
Statutory federal tax rate |  |  | 35.0 | % |  | 35.0 | % |  | 35.0 | % |  | 35.0 | %
State income taxes, net of federal income tax benefit |  |  | 4.8 |  |  | 5.1 |  |  | 5.3 |  |  | 4.5 |
Tax credits, net of federal income tax benefit |  |  | (0.9) |  |  | (1.0) |  |  | (1.1) |  |  | (0.2) |
Unrecognized tax benefits and related interest |  |  | – |  |  | – |  |  | – |  |  | - |
Other |  |  | (1.1) |  |  | (0.5) |  |  | 0.3 |  |  | 0.9 |
|  |  | 37.8 | % |  | 38.6 | % |  | 39.5 | % |  | 40.2 | %
Net income taxes paid in fiscal 2016, the Transition Period, fiscal 2015 and fiscal 2014 totaled $25,017,000, $8,270,000, $10,918,000 and $19,437,000, respectively. A reconciliation of the beginning and ending gross amounts of unrecognized tax benefit are as follows:
|  | Year Ended |  | 31 Weeks Ended |  | Year Ended |
|  | December 29, 2016 |  | December 31, 2015 |  | May 28, 2015 |  | May 29, 2014 |
|  | (in thousands) |
Balance at beginning of year |  | $ | 414 |  | $ | 431 |  | $ | 102 |  | $ | 102 |
Increases due to: |  |  |  |  |  |  |  |  |  |  |  |  |
Tax positions taken in prior years |  |  | - |  |  | - |  |  | 543 |  |  | - |
Tax positions taken in current year |  |  | - |  |  | - |  |  | - |  |  | - |
Decreases due to: |  |  |  |  |  |  |  |  |  |  |  |  |
Tax positions taken in prior years |  |  | - |  |  | - |  |  | - |  |  | - |
Settlements with taxing authorities |  |  | - |  |  | (17) |  |  | (214) |  |  | - |
Lapse of applicable statute of limitations |  |  | - |  |  | - |  |  | - |  |  | - |
Balance at end of year |  | $ | 414 |  | $ | 414 |  | $ | 431 |  | $ | 102 |
The Company’s total unrecognized tax benefits that, if recognized, would affect the Company’s effective tax rate were $67,000 as of December 29, 2016, December 31, 2015, May 28, 2015 and May 29, 2014. At December 29, 2016, the Company had accrued interest of $130,000 and no accrued penalties compared to accrued interest of $101,000 and no accrued penalties at December 31, 2015. The Company classifies interest and penalties relating to income taxes as income tax expense. For the year ended December 29, 2016, $153,000 of interest and no accrued penalties were recognized in the statement of earnings, compared to $108,000 of interest and no accrued penalties for the Transition Period, $89,000 of interest and no accrued penalties for the year ended May 28, 2015 and $(1,000) of interest and no accrued penalties for the year ended May 29, 2014. During fiscal 2015, the Company settled an examination by the Internal Revenue Service of its income tax return for the year ended May 31, 2012. As a result, the Company's federal income tax returns are no longer subject to audit prior to fiscal year 2013. With certain exceptions, the Company's state income tax returns are no longer subject to examination for the fiscal years 2010 and prior. At this time, the Company does not expect the results from any income tax audit or appeal to have a significant impact on the Company's financial statements. The Company does not expect its unrecognized tax benefits to change significantly over the next twelve months.

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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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32559-109319 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32718-109319 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32639-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32537-109319 + Details
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