The Company changed its method of accounting related to the capitalization of property and equipment for its FY2020 U.S. federal income tax return (filed in the fourth quarter of FY2021), increasing its taxable income. Subsequently, the Company made a related change in its method of accounting that will result in a net operating loss (NOL) on its FY2021 income tax returns. Pursuant to provisions under the CARES Act, the U.S. federal income tax NOL generated in FY2021 will be carried back to tax years when the U.S. federal statutory income tax rate was greater than the current 21.0 percent. As a result of these method changes, in the fourth quarter of FY2021 the Company recorded a $56.2 million dollar income tax benefit and an income tax receivable of $232.6 million, which is included within prepaid expenses and other current assets on the accompanying consolidated balance sheet.

The domestic and foreign components of income before provision for income taxes are as follows (in thousands):

	Year Ended June 30,
	2021		2020		2019
Domestic	$	471,711	$	379,414	$	308,922
Foreign		27,904		22,223		18,987
Income before income taxes	$	499,615	$	401,637	$	327,909

	Year Ended June 30,
	2021			2020			2019
Current:
Federal	$	(94,143	)	$	42,268		$	41,675
State and local		19,958			14,744			17,606
Foreign		7,384			5,271			4,033
Total current		(66,801	)		62,283			63,314
Deferred:
Federal		109,157			12,940			(27	)
State and local		185			5,465			(877	)
Foreign		(369	)		(531	)		(105	)
Total deferred		108,973			17,874			(1,009	)
Total income tax expense	$	42,172		$	80,157		$	62,305

Income tax expense differs from the amounts computed by applying the U.S. federal statutory income tax rate of 21.0 percent as a result of the following (in thousands):

	Year Ended June 30,
	2021			2020			2019
Expected tax expense computed at federal statutory rate	$	104,919		$	84,344		$	68,861
State and local taxes, net of federal benefit		21,252			15,965			13,216
Remeasurement of current year NOL		(56,192	)		—			—
Nonincludible and nondeductible items, net		(2,269	)		3,133			1,971
Remeasurement of deferred taxes and transition tax		—			—			(2,182	)
Effect of foreign tax rates		(687	)		(377	)		(380	)
R&D tax credit, net		(18,173	)		(10,700	)		(6,755	)
Other tax credits		(648	)		(1,183	)		(2,138	)
Stock-based compensation		(5,525	)		(10,900	)		(7,493	)
Other		(505	)		(125	)		(2,795	)
Total income tax expense	$	42,172		$	80,157		$	62,305
Effective income tax rate		8.4	%		20.0	%		19.0	%

The effective income tax rate in FY2021, FY2020, and FY2019, was 8.4 percent, 20.0 percent, and 19.0 percent, respectively. The effective income tax rate decreased in FY2021 primarily as a result of the $56.2 million benefit related to the carryback of the federal income tax NOL under the CARES Act, as well as an increase in research and development tax credits for past and current year returns.

The tax effects of temporary differences that give rise to deferred taxes are presented below (in thousands):

	June 30,
	2021			2020
Deferred tax assets:
Deferred compensation and post-retirement obligations	$	36,183		$	33,094
Reserves and accruals		58,900			41,137
Stock-based compensation		11,767			9,860
NOL carryforward		39,123			—
Lease liability		110,282			99,539
Interest rate swaps		6,800			11,349
Other assets		2,757			6,786
Total deferred tax assets		265,812			201,765
Deferred tax liabilities:
Goodwill and other intangible assets		(291,282	)		(273,088	)
Unbilled revenue		(35,115	)		(17,429	)
Prepaid expenses		(8,932	)		(6,444	)
Right of use assets		(90,186	)		(85,275	)
Property and equipment		(167,527	)		(32,625	)
Total deferred tax liabilities		(593,042	)		(414,861	)
Net deferred tax liability	$	(327,230	)	$	(213,096	)

As discussed above, the FY2021 change in method of accounting will result in net operating losses on the Company’s FY2021 tax returns. For state tax purposes, the related losses will be carried forward, thus a NOL carryforward was recorded. The increase in the property and equipment deferred tax liability largely relates to the Company's changes in method of accounting and represents income to be recognized in future years

The Company is subject to income taxes in the U.S. and various state and foreign jurisdictions. Tax statutes and regulations within each jurisdiction are subject to interpretation and require the application of significant judgment. The Company is currently under examination by the Internal Revenue Service for fiscal years 2017 through 2019. The Company does not expect the resolution of these examinations to have a material impact on its results of operations, financial condition or cash flows.

U.S. income taxes have not been provided for undistributed earnings of foreign subsidiaries that have been permanently reinvested outside the United States. As of June 30, 2021, the estimated deferred tax liability associated with these undistributed earnings is approximately $1.9 million.

Changes in the Company’s liability for unrecognized tax benefits is shown in the table below (in thousands):

	Year Ended June 30,
	2021			2020		2019
Beginning of year	$	8,826		$	1,530	$	4,122
Additions based on current year tax positions		5,702			2,293		676
Lapse of statute of limitations		—			—		(164	)
Additions based on prior year tax positions		20,025			5,003		—
Reductions based on prior tax year positions		—			—		(3,104	)
Settlement with taxing authorities		(3,048	)		—		—
End of year	$	31,505		$	8,826	$	1,530

The Company’s total liability for unrecognized tax benefits as of June 30, 2021, 2020 and 2019 was approximately $ 31.5 million, $8.8 million and $1.5 million, respectively. During FY2021, the Company recognized an increase in reserves primarily related to current and prior year research and development tax credits. Any amount, if recognized, would positively impact the Company’s effective tax rate.

The Company recognizes net interest and penalties as a component of income tax expense. Over the next 12 months, the Company does not expect a significant increase or decrease in the unrecognized tax benefits recorded at June 30, 2021. As of June 30, 2021, the entire balance of unrecognized tax benefits is included in other long-term liabilities.