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Income Taxes (Tables)

12 Months Ended

Jun. 30, 2019

The components of income before income taxes consist of the following:

Provision (benefit) for income taxes consists of the following:

	For the Fiscal Year Ended
	June 30, 2019			June 24, 2018			June 25, 2017
Current:
Federal	$	(178	)	$	(4,918	)	$	(6,082	)
State		28			(416	)		(130	)
Foreign		7,282			9,639			10,224
Total current tax expense		7,132			4,305			4,012
Deferred:
Federal		(813	)		(5,315	)		6,602
State		1,097			(872	)		162
Foreign		139			391			122
Total deferred tax expense		423			(5,796	)		6,886
Provision (benefit) for income taxes	$	7,555		$	(1,491	)	$	10,898

Reconciliation from the federal statutory tax rate to the effective tax rate is as follows:

	For the Fiscal Year Ended
	June 30, 2019			June 24, 2018			June 25, 2017
Federal statutory tax rate		21.0	%		28.3	%		35.0	%
Foreign income taxed at different rates		16.1			(2.4	)		(10.2	)
Repatriation of foreign earnings and withholding taxes		20.3			1.8			1.4
Repatriation of foreign earnings due to tax reform		0.7			23.9			—
Revaluation of U.S. deferred balances due to tax reform		3.1			(14.2	)		—
U.S. tax on GILTI		32.5			—			—
Change in valuation allowance		(1.5	)		(12.9	)		(0.5	)
Foreign tax credits		(11.9	)		(11.0	)		—
Domestic production activities deduction		(5.6	)		0.5			2.0
Research and other credits		(7.7	)		(1.8	)		(5.1	)
State income taxes, net of federal tax benefit		(0.6	)		(3.9	)		0.2
Change in uncertain tax positions		8.2			(15.1	)		1.8
Nondeductible compensation		5.1			1.6			—
Nontaxable income		(4.2	)		—			—
Nondeductible expenses and other		—			0.3			0.6
Effective tax rate		75.5	%		(4.9	)%		25.2	%

The significant components of UNIFI’s deferred tax assets and liabilities consist of the following:

	June 30, 2019			June 24, 2018
Deferred tax assets:
Investments, including unconsolidated affiliates	$	5,680		$	5,429
Intangible assets		1,679			2,141
Accrued compensation and benefits		1,761			2,089
Tax credits		17,237			5,845
NOL carryforwards		4,381			10,008
Research and development costs		4,081			—
Other items		5,555			4,847
Total gross deferred tax assets		40,374			30,359
Valuation allowance		(26,020	)		(15,143	)
Net deferred tax assets		14,354			15,216
Deferred tax liabilities:
PP&E		(18,325	)		(19,375	)
Other		(295	)		(216	)
Total deferred tax liabilities		(18,620	)		(19,591	)
Net deferred tax liabilities	$	(4,266	)	$	(4,375	)

The balances and activity for UNIFI’s deferred tax valuation allowance are as follows:

	For the Fiscal Year Ended
	June 30, 2019			June 24, 2018			June 25, 2017
Balance at beginning of year	$	(15,143	)	$	(17,957	)	$	(13,550	)
(Increase) decrease in valuation allowance		(10,877	)		2,814			(4,407	)
Balance at end of year	$	(26,020	)	$	(15,143	)	$	(17,957	)

Components of UNIFI’s deferred tax valuation allowance are as follows:

	For the Fiscal Year Ended
	June 30, 2019			June 24, 2018			June 25, 2017
Investments, including unconsolidated affiliates	$	(5,696	)	$	(5,522	)	$	(7,789	)
NOL carryforwards ⁽¹⁾		(4,048	)		(4,191	)		(9,379	)
Tax credits		(16,276	)		(5,430	)		(789	)
Total deferred tax valuation allowance	$	(26,020	)	$	(15,143	)	$	(17,957	)

(1)	Includes certain U.S. NOLs and capital losses outside the U.S. consolidated tax filing group.

A reconciliation of beginning and ending gross amounts of unrecognized tax benefits is as follows:

	For the Fiscal Year Ended
	June 30, 2019			June 24, 2018			June 25, 2017
Balance at beginning of year	$	166		$	4,463		$	4,254
Gross increases related to current period tax positions		26			26			124
Gross increases (decreases) related to tax positions in prior periods		980			(119	)		524
Gross decreases related to settlements with tax authorities		—			(4,204	)		(439	)
Gross decreases related to lapse of applicable statute of limitations		(89	)		—			—
Balance at end of year	$	1,083		$	166		$	4,463