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Income Taxes
 9 Months Ended
Oct. 30, 2021
Income Tax Disclosure [Abstract]  
Income Taxes
Note 16 – Income Taxes
Our effective tax rates for the period are as follows:
 
    
Three Months
Ended
    
Nine Months
Ended
  
Fiscal 2022
      29.0 %      4.0 % 
Fiscal 2021
      160.0 %      45.9 % 
We determine our estimated annual effective tax rate at the end of each interim period based on full-year forecasted
pre-tax
income and facts known at that time. The estimated annual effective tax rate is applied to the
year-to-date
pre-tax
income at the end of each interim period with the cumulative effect of any changes in the estimated annual effective tax rate being recorded in the fiscal quarter in which the change is determined. The tax effect of significant unusual items is reflected in the period in which they occur.
During the three months ended October 30, 2021, we recognized an income tax benefit of approximately $174,000. The effective tax rate in this period was directly impacted by a significant decrease in forecasted operating results for our fiscal 2022 as compared to operating results forecasted at the end of our second quarter of fiscal 2022. During the three months ended October 31, 2020, we recognized an income tax benefit of approximately $32,000. The effective tax rate in this period was directly impacted by a significant decrease in forecasted operating results for our fiscal 2021 as compared to operating results forecasted at the end of our second quarter of fiscal 2021.
During the nine months ended October 30, 2021, we recognized an income tax expense of approximately $297,000. The effective tax rate in this period was directly impacted a significant decrease in forecasted operating results for our fiscal 2022 as compared to operating results forecasted at the end of our second quarter of fiscal 2022, a $1.1 million tax benefit from the forgiveness of the PPP
L
oan, a $0.1 million tax benefit arising from windfall tax expense related to our stock, a $30,000 tax benefit related to return to provision adjustments from foreign tax returns filed in the year, and a $0.3 million tax benefit related to the expiration of the statute of limitations on previously uncertain tax positions. The PPP
L
oan forgiveness recognized is excluded from taxable income under Section 1106(i) of the CARES Act. During the nine months ended October 31, 2020, we recognized an income tax expense of approximately $379,000. The effective tax rate in this period was directly impacted by a significant decrease in forecasted operating results for our fiscal 2021 as compared to operating results forecasted at the end of our second quarter of fiscal 2021, a $118,000 expense arising from shortfall tax expense related to our stock, a $79,000 expense related to return to provision adjustments from foreign tax returns filed in the year and a $78,000 tax benefit related to the expiration of the statute of limitations on previously uncertain tax positions.
We maintain a valuation allowance on some of our deferred tax assets in certain jurisdictions. A valuation allowance is required when, based upon an assessment of various factors, including recent operating loss history, anticipated future earnings, and prudent and reasonable tax planning strategies, it is more likely than not that some portion of the deferred tax assets will not be realized.
Unrecognized tax benefits represent the difference between tax positions taken or expected to be taken in a tax return and the benefits recognized for financial reporting purposes. As of October 30, 2021, our cumulative unrecognized tax benefits totaled $221,000 compared to $384,000
as of January 31, 2021. We established unrecognized tax benefits for certain positions taken on the fiscal year 2021 Canadian tax return. There were no other developments affecting unrecognized tax benefits during the quarter ended October 30, 2021.