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INCOME TAXES
 6 Months Ended
Jun. 29, 2013
INCOME TAXES  
INCOME TAXES

5.  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

 

For the 26 Weeks Ended

 

 

 

June 29, 2013

 

June 30, 2012

 

June 29, 2013

 

June 30, 2012

 

Income tax expense

 

$

33,829

 

$

27,705

 

$

62,723

 

$

51,229

 

Income tax rate

 

32.5

%

31.4

%

30.3

%

29.7

%

 

The higher effective tax rate in the Second Quarter and the Year To Date Period was primarily due to the quarter impact of adjusting the estimated full year rate to reflect a shift in geographical earnings mix.

 

As of June 29, 2013, the total amount of unrecognized tax benefits, excluding interest and penalties, was $9.6 million, of which $6.1 million would favorably impact the effective tax rate in future periods, if recognized. The U.S. Internal Revenue Service completed its examination of the Company’s 2007-2009 federal income tax returns, and the Company has settled all outstanding federal income tax liabilities for those years.  The Company is subject to examinations in various state and foreign jurisdictions for its 2005-2012 tax years, none of which the Company believes are individually significant. Audit outcomes and 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 June 29, 2013, the Company had recorded $0.2 million of unrecognized tax benefits, 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 and penalties included in the condensed consolidated balance sheets at June 29, 2013 was $0.9 million and $0.3 million, respectively. For the Second Quarter, the Company accrued income tax-related interest expense of $0.1 million.