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INCOME TAXES | 6 Months Ended
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Jul. 05, 2025
Income Tax Disclosure [Abstract] |
INCOME TAXES | INCOME TAXES The Company’s income tax (benefit) expense and related effective rates were as follows (in thousands, except percentage data):
| For the 13 Weeks Ended July 5, 2025 |  | For the 13 Weeks Ended June 29, 2024 |  | For the 27 Weeks Ended July 5, 2025 |  | For the 26 Weeks Ended June 29, 2024
Income tax (benefit) expense | $ | 6,230 |  |  | $ | 2,208 |  |  | $ | 9,598 |  |  | $ | (3,908) |
Effective tax rate | 150.9 | % |  | (6.0) | % |  | (92.7) | % |  | 5.8 | %
The effective tax rate in the Second Quarter differed from the Prior Year Quarter primarily due to a change in the Company’s global mix of earnings. In addition, income taxes were accrued on certain income in foreign jurisdictions and no tax benefit has been accrued on the U.S. tax losses and on certain losses in other foreign jurisdictions due to valuation allowances previously recorded. The effective tax rate can also vary from quarter-to-quarter due to changes in the resolution of income tax audits, changes in uncertain tax positions, and changes in tax law. On July 4, 2025, the United States Congress passed the budget reconciliation bill H.R. 1, commonly referred to as the One Big Beautiful Bill Act ("OBBBA"). The OBBBA makes permanent many of the provisions previously enacted as part of the 2017 Tax Cut and Jobs Act that were set to expire at the end of 2025 and includes other changes to certain U.S. corporate tax provisions. The changes to U.S. tax law that were enacted under the OBBBA include modifications to capitalization of research and development expenses, limitations on deductions for interest expense and accelerated fixed asset depreciation. Based on our current U.S. tax position, we note no material tax impacts as a result of the changes introduced under the OBBBA. As of July 5, 2025, the Company's total amount of unrecognized tax benefits, excluding interest and penalties, was $6.3 million, all of which would favorably impact the effective tax rate in future periods, if recognized. The Company released corresponding uncertain tax positions of $1.0 million in the first quarter of 2025. It is reasonably expected that certain uncertain tax positions will be resolved within the next 12 month period, and if resolved favorably, it would impact the tax rate by a benefit of approximately $3.1 million, including interest. The Company is also subject to examinations in various state and foreign jurisdictions for its 2013-2024 tax years, none of which the Company believes are significant, individually or in the aggregate. Tax audit outcomes and timing of tax 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 settled within twelve months of the condensed consolidated balance sheet date. As of July 5, 2025, the Company has not recorded any new unrecognized tax benefits, excluding interest and penalties, for positions that are expected to 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. At July 5, 2025, the total amount of accrued income tax-related interest expense, net included in the condensed consolidated balance sheets was $1.4 million. There were no accrued tax-related penalties.

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