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Income Taxes
 3 Months Ended
Mar. 31, 2012
Income Taxes [Abstract]  
Income Taxes

3. INCOME TAXES

The Company's income tax expense and related effective rate were as follows (in thousands except percentage data):

 

     For the 13 Weeks Ended
March 31, 2012		     For the 13 Weeks Ended
April 2, 2011		  

Income tax expense

    $ 23,524      $ 31,192   

Income tax rate

      27.8 %      34.9 % 

The lower effective tax rate in the First Quarter was attributable to various discrete items and the release of $2.8 million of deferred income tax liabilities associated with a change in management's plans; as a result, a portion of undistributed earnings of certain foreign subsidiaries will be indefinitely reinvested.

As of March 31, 2012, the total amount of unrecognized tax benefits, excluding interest and penalties, was $18.0 million, of which $12.7 million would favorably impact the effective tax rate in future periods, if recognized. The examination phase of the Internal Revenue Service ("IRS") audit for tax years 2005 and 2006 was completed in 2010. The IRS proposed certain adjustments, and the Company filed a protest. This protest is under review by the IRS Office of Appeals, and it is possible that it may be resolved within the next twelve months. The Company is also subject to examinations in various state and foreign jurisdictions for the 2004-2010 tax years, none of which are individually significant. Audit outcomes and the timing of audit settlements are subject to significant uncertainty.

The Company has classified uncertain tax positions as long-term income taxes payable unless such amounts are expected to be paid within twelve months of the condensed consolidated balance sheet date. As of March 31, 2012, the Company has recorded unrecognized tax benefits of $2.7 million, excluding interest and penalties, for positions that could be settled within the next twelve months. Consistent with its past practice, the Company recognizes interest and/or penalties related to income tax overpayments and income tax underpayments in income tax expense and income taxes receivable/payable, respectively. The total amount of accrued income tax-related interest included in the condensed consolidated balance sheet at March 31, 2012 was $2.6 million. There were no penalties accrued in the condensed consolidated balance sheet at March 31, 2012. For the First Quarter, the Company accrued income tax-related interest expense of $0.2 million.