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Note L - Income Taxes
 3 Months Ended
Jun. 29, 2025
Notes to Financial Statements  
Income Tax Disclosure [Text Block]

NOTE L – INCOME TAXES

 

The effective income tax rates for the thirteen week periods ended June 29, 2025 and June 30, 2024 were 27.2% and 27.4%, respectively. The effective income tax rate for the thirteen weeks ended June 29, 2025 reflected $3,329 of income tax expense recorded on $12,257 of pre-tax income. The effective income tax rate for the thirteen weeks ended June 30, 2024 reflected $3,507 of income tax expense recorded on $12,784 of pre-tax income. The effective tax rates are higher than the United States Federal statutory rates primarily due to state and local taxes, as well as non-deductible compensation under the Internal Revenue Code Section 162(m).

 

The amount of unrecognized tax benefits included in Other liabilities at June 29, 2025 and March 30, 2025 was $579 and $532, respectively, all of which would impact the Company’s effective rate, if recognized. As of June 29, 2025 and March 30, 2025, the Company had approximately $428 and $395, respectively, of accrued interest and penalties in connection with unrecognized tax benefits.

 

On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act (“OBBBA”). The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The OBBBA makes permanent key elements of the Tax Cuts and Jobs Act, including 100% bonus depreciation, and the business interest expense limitation. ASC 740, “Income Taxes”, requires the effects of changes in tax rates and laws on deferred tax balances to be recognized in the period in which the legislation is enacted. Consequently, as of the date of enactment, and during the three months ended September 28, 2025, the Company will evaluate all deferred tax balances under the newly enacted tax law and identify any other changes required to its financial statements as a result of the OBBBA. The Company is still evaluating the impact of the OBBBA and the results of such evaluations will be reflected on the Company’s Form 10-Q for the quarter ended September 28, 2025.