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Income Taxes
9 Months Ended
Sep. 26, 2015
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes
The effective tax rates for the third quarter and year-to-date periods of 2015 were 28.5 percent and 28.4 percent compared with 32.5 percent and 30.0 percent, respectively, for the comparable 2014 periods. The higher 2014 rates were due to higher 2014 losses incurred related to the devaluation of the Venezuelan bolivar for which no tax benefit could be recognized. In addition, the Company reduced its accrual for uncertain tax positions by $1.0 million due to the expiration of statutes of limitation in various jurisdictions in the third quarter of 2015, of which $0.2 million did not impact tax expense. The effective tax rates are below the U.S. statutory rate primarily due to lower foreign effective tax rates.
As of September 26, 2015 and December 27, 2014, the Company's gross unrecognized tax benefit was $20.0 million and $22.5 million, respectively. The Company estimates that approximately $18.2 million of the unrecognized tax benefits, if recognized, would impact the effective tax rate. Interest and penalties related to uncertain tax positions in the Company's global operations are recorded as a component of the provision for income taxes. Accrued interest and penalties were $5.0 million and $6.5 million as of September 26, 2015 and December 27, 2014, respectively. During 2015, the accrual for uncertain tax positions decreased by $2.3 million primarily as a result of the Company agreeing to audit settlements and expiration of statutes of limitation in various jurisdictions. In addition, the accrual for interest and penalties was reduced by $1.3 million.
The Company estimates that it may settle one or more foreign audits in the next twelve months that may result in a decrease in the amount of accrual for uncertain tax positions of up to $1.0 million. For the remaining balance as of September 26, 2015, the Company is not able to reliably estimate the timing or ultimate settlement amount. While the Company does not currently expect material changes, it is possible that the amount of unrecognized benefit with respect to the uncertain tax positions will significantly increase or decrease related to audits in various foreign jurisdictions that may conclude during that period or new developments including changes in laws that could also, in turn, impact the Company's assessment relative to the establishment of valuation allowances against certain existing deferred tax assets. These valuation allowances relate to tax assets in jurisdictions where it is management's best estimate that there is not a greater than 50 percent probability that the benefit of the assets will be realized in the associated tax returns. The likelihood of realizing the benefit of deferred tax assets is assessed on an ongoing basis. This assessment requires estimates as to future operating results, as well as an evaluation of the effectiveness of the Company's tax planning strategies. At this time, the Company is not able to make a reasonable estimate of the range of impact on the balance of unrecognized tax benefits or the impact on the effective tax rate related to these items.