v3.25.4
Note 13 - Income Taxes
 12 Months Ended
Nov. 29, 2025
Notes to Financial Statements  
Income Tax Disclosure [Text Block]

13.

Income Taxes

 

The components of the income tax provision from operations are as follows:

 

   

2025

    

2024

    

2023

  

Current:

                        

Federal

   $ 1,538     $ (1,962 )   $ (121 )

State

     210       (273 )     (72 )
                         

Deferred:

                        

Federal

     545       (1,781 )     846  

State

     367       (659 )     30  

Total

   $ 2,660     $ (4,675 )   $ 683  

 

A reconciliation of the statutory federal income tax rate and the effective income tax rate, as a percentage of income before income taxes, is as follows:

 

   

2025

    

2024

    

2023

  

Statutory federal income tax rate

     21.0

%

     21.0

%

     21.0

%

State income tax, net of federal benefit

     5.2       5.4       3.8  

Nondeductible goodwill, restructuring and other charges

     6.2       (6.5 )     (42.7 )

Nontaxable gain on revaluation of contingent consideration

     -       -       8.6  

Capital loss carryback

     (2.0 )     15.9       -  

Change in valuation allowance

     -       (3.3 )     (18.2 )

Effective income tax rate

     30.4 %     32.5

%

     (27.5

)%

 

Excess tax benefits (deficiencies) in the amount of $(21), $(9) and $10 were recognized as a component of income tax expense during fiscal 2025, 2024 and 2023, respectively, resulting from the exercise of stock options and the release of restricted shares. The fiscal 2023 adjustment for impairment of non-deductible goodwill reflects the fact that there was no tax basis related to the impaired goodwill.

 

In July of 2025, new tax legislation was enacted under the One Big Beautiful Bill Act (the “Act”). While the Act includes a wide range of provisions that could impact our financial results in future periods, the passage of the Act did not have a material impact on our results of operations or financial condition in fiscal 2025.

 

The income tax effects of temporary differences and carryforwards, which give rise to significant portions of the deferred income tax assets and deferred income tax liabilities, are as follows:

 

   

November 29,

2025

    

November 30,

2024

  

Deferred income tax assets:

                

Trade accounts receivable

   $ 108     $ 278  

Inventories

     4,070       3,867  

Post employment benefit obligations

     2,652       2,498  

Federal net operating loss and credit carryforwards

     -       1,107  

State net operating loss carryforwards

     374       621  

Foreign net operating loss carryforwards

     2,264       2,264  

Operating lease liabilities

     22,527       27,138  

Other

     1,142       1,182  

Gross deferred income tax assets

     33,137       38,955  

Valuation allowance

     (2,264 )     (2,264 )

Total deferred income tax assets

     30,873       36,691  
                 

Deferred income tax liabilities:

                

Property and equipment

     3,443       4,200  

Intangible assets

     1,472       1,235  

Operating lease assets

     19,438       23,771  

Prepaid expenses and other

     541       618  
                 

Total deferred income tax liabilities

     24,894       29,824  
                 

Net deferred income tax assets

   $ 5,979     $ 6,867  

 

We have foreign net operating loss carryforwards attributable to Noa Home of $10,780 resulting in a deferred tax asset of $2,264 upon which we have placed a full valuation allowance. As of November 29, 2025, we have no remaining federal net operating loss carryforwards and we have state net operating loss carryforwards totaling $6,799 expiring in various years through 2044.

 

Income taxes paid, net of refunds received, during fiscal 2025 was $379. Income tax refunds received, net of taxes paid, during fiscal 2024 and 2023 were $658 and $263, respectively.

 

We regularly evaluate, assess and adjust our accrued liabilities for unrecognized tax benefits in light of changing facts and circumstances, which could cause the effective tax rate to fluctuate from period to period. Our liabilities for uncertain tax positions are not material.

 

Significant judgment is required in evaluating the Company's federal and state tax positions and in the determination of its tax provision. Despite our belief that the liability for unrecognized tax benefits is adequate, it is often difficult to predict the final outcome or the timing of the resolution of any particular tax matter. We may adjust these liabilities as relevant circumstances evolve, such as guidance from the relevant tax authority, or resolution of issues in the courts. These adjustments are recognized as a component of income tax expense in the period in which they are identified. The Company also cannot predict when or if any other future tax payments related to these tax positions may occur.

 

We remain subject to examination for tax years 2022 through 2025 for all of our major tax jurisdictions.