Income Taxes

9 Months Ended

Sep. 30, 2011

Income Taxes [Abstract]

Income Taxes

Note 3 – Income Taxes

The provision for income taxes consists of provisions for federal, state, and foreign income taxes.  The effective tax rates for the periods ended October 1, 2011 and October 2, 2010 reflect the Company’s expected tax rate on reported income from continuing operations before income tax and tax adjustments. The Company operates in a global environment with significant operations in various locations outside the United States.  Accordingly, the consolidated income tax rate is a composite rate reflecting the Company’s earnings and the applicable tax rates in the various locations where the Company operates.

In January 2011, a new tax law was enacted in Israel which effectively lowered the corporate income tax rate on certain types of income earned after December 31, 2010.  Accordingly, the Company’s deferred tax assets in Israel were written down to reflect the lower rate and a one-time tax expense of $10.0 million was recorded in the consolidated condensed statement of operations during the nine fiscal months ended October 1, 2011.

During the nine fiscal months ended October 1, 2011, the liabilities for unrecognized tax benefits increased by $2.9 million on a net basis, principally due to increases for positions taken during prior periods of $4.8 million, increases for positions taken during the current period of $0.9 million, and interest of $3.0 million, partially offset by decreases due to settlements of $5.4 million and foreign exchange effects of $0.4 million.  Tax expense recorded for uncertain tax positions for the nine fiscal months ended October 1, 2011 was $5.8 million, including the interest of $3.0 million.