Income Taxes

6 Months Ended

Jul. 04, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company’s effective tax rate for the three months ended July 4, 2021 and June 28, 2020 was 18.6% and 20.8%, respectively. The Company’s effective tax rate varied from the U.S. federal statutory rate of 21% for the three months ended July 4, 2021 primarily due to a reduction for the benefit of share-based compensation, partially offset by an increase due to state income taxes.

The Company’s effective tax rate for the six months ended July 4, 2021 and June 28, 2020 was 20.8% and 25.4%, respectively. The Company’s effective tax rate varied from the U.S. federal statutory rate of 21% for the six months ended July 4, 2021 primarily due to a reduction for the benefit of share-based compensation, partially offset by an increase due to state income taxes, including discrete changes to state deferred taxes.

There were no significant changes to the unrecognized tax benefits or related interest and penalties for the three and six months ended July 4, 2021. During the next twelve months, we believe it is reasonably possible the Company will reduce unrecognized tax benefits by up to $2,016 due primarily to the lapse of statutes of limitations and expected settlements.

The current portion of refundable income taxes was $4,528 and $5,399 as of July 4, 2021 and January 3, 2021, respectively, and is included in “Accounts and notes receivable, net.” There were no long-term refundable income taxes as of July 4, 2021 and January 3, 2021.