Quarterly report [Sections 13 or 15(d)]

Income Taxes

v3.26.1
Income Taxes
 3 Months Ended
Mar. 29, 2026
Income Taxes  
Income Taxes

Note 7 – Income Taxes

Income taxes are recorded at the Company’s estimated annual effective income tax rate, subject to adjustments for discrete events should they occur. The Company recorded a provision for income taxes of $1.2 million for the first quarter of 2026 compared to a provision of $0.3 million for the first quarter of 2025. The Company’s effective income tax rate including discrete events was 28.0% and 31.4% for the three periods ended March 29, 2026 and March 30, 2025, respectively. The Company’s projected annual effective tax rate differs from the statutory U.S. tax rate of 21% primarily due to the following: (i) tax credits for FICA taxes on certain employees’ tips; (ii) taxes owed in foreign jurisdictions with tax rates that differ from the U.S. statutory rate; (iii) taxes owed in state and local jurisdictions; and (iv) the tax effect of non-deductible compensation.

The Company is subject to U.S. federal, state, local and various foreign income taxes for the jurisdictions in which it operates. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. In the normal course of business, the Company is subject to examination by the federal, state, local and foreign taxing authorities.