v2.4.0.6
INCOME TAXES
 3 Months Ended
Jun. 28, 2012
INCOME TAXES  
INCOME TAXES

NOTE 7—INCOME TAXES

        The difference between the effective tax rate on earnings from continuing operations before income taxes and the U.S. federal income tax statutory rate is as follows:

 
   Thirteen Weeks Ended  
(In thousands)
  June 28,
2012 		  June 30,
2011 		 

Income tax expense at the federal statutory rate

   $ 7,100   $ 550  

Effect of:

              

State income taxes

     400     525  

Permanent items

     250     —  

Change in ASC 740 (formally FIN 48) reserve

     600     (900 )

Valuation allowance

     (7,950 )   350  
           

Income tax expense

   $ 400   $ 525  
           

Effective income tax rate

     2.0 %   33.2 %
           

        The accounting for income taxes requires that deferred tax assets and liabilities be recognized, using enacted tax rates, for the tax effect of temporary differences between the financial reporting and tax bases of recorded assets and liabilities. Deferred tax assets are reduced by a valuation allowance if it is more likely than not that some or all of the deferred tax assets will not be realized.

        The current period decrease related to ASC 740, Income Taxes, (formally FIN 48) reserve includes increases for the current year positions of $600,000.

        The state tax provision was for the states that impose their income based taxes on a gross sales method, that impose a margin tax or that have suspended the use of net operating loss carryforwards into the current tax year.