Note K - Income Taxes	9 Months Ended
Dec. 23, 2018
Notes to Financial Statements
Income Tax Disclosure [Text Block]	NOTE K – INCOME TAXES On December 22, 2017, the Tax Cuts and Jobs Act, (the “Tax Act”) was enacted which among other provisions, reduced the top corporate tax rate from 35 percent to a flat 21 percent beginning January 1, 2018 and eliminated the corporate Alternative Minimum Tax. The Tax Act limits the deduction of business interest, net of interest income, to 30 percent of the adjusted taxable income of the taxpayer in any taxable year. Any amount disallowed under the limitation is treated as business interest paid or accrued in the following year. Disallowed interest will have an indefinite carryforward. The Tax Act also repeals the performance-based exception to the $1.0 million deduction limitation on executive compensation and modifies the definition of “covered employees”. Additionally, the Tax Act intended to allow businesses to immediately expense the full cost of Qualified Improvement Property. However, the law as written does not permit restaurant companies to take advantage of the laws’ intention. Nathan’s determined that its blended federal tax rate was 31% for its fiscal year ending March 25, 2018, as a result of the Tax Act. The income tax provisions for the thirty-nine week periods ended December 23, 2018 and December 24, 2017 reflect effective tax rates of 27.8% and 21.5%, respectively. The Company’s tax rate reflects the reduction in our Federal income tax rate from 31% to 21% pursuant to the Tax Act. During the quarter ended December 24, 2017, pursuant to Staff Accounting Bulletin #118, Nathan’s determined reasonable estimates to its deferred assets and liabilities and pursuant to ASC 740, Income Taxes, the Company recognized the effect(s) of the Tax Act on current and deferred income taxes in its financial statements. Nathan’s recorded the following discrete adjustment to its deferred tax liability and unrecognized tax benefits which reduced the provision for income taxes by $436,000 or 1,510 BPS during the thirty-nine weeks ended December 24, 2017, lowering its effective tax rate from 36.6% to 21.5%. Nathan’s effective tax rates for the thirty-nine week periods ended December 23, 2018 and December 24, 2017 were also reduced by 20 BPS and 670 BPS, respectively, as a result of the tax benefits associated with stock compensation. For the thirty-nine week periods ended December 23, 2018 and December 24, 2017, excess tax benefits of $47,000 and $194,000, respectively, were reflected in the Consolidated Statements of Earnings as a reduction in determining the provision for income taxes. The amount of unrecognized tax benefits at December 23, 2018 was $249,000 all of which would impact Nathan’s effective tax rate, if recognized. As of December 23, 2018, Nathan’s had $242,000 of accrued interest and penalties in connection with unrecognized tax benefits. In January 2018, Nathan’s received notification from the State of Virginia that it was seeking to review Nathan’s tax returns for the period April 2014 through March 2017. The review has been completed; Nathan’s has accepted the findings and settled the matter in the second quarter fiscal 2019. The effects of the review, which were not significant, have been factored into the Company’s effective tax rate for fiscal 2019. Nathan’s estimates that its annual tax rate for the fiscal year ending March 31, 2019 will be in the range of approximately 27.0% to 29.0% excluding the impact of any discrete items recorded and excess tax benefit associated with stock compensation. The final annual tax rate is subject to many variables, including the ultimate determination of revenue and income tax by state, among other factors, and cannot be determined until the end of the fiscal year; therefore, the actual tax rate could differ from our current estimates . In addition, the ultimate benefit of the Tax Act on Nathan’s is unclear as the lower annual tax rate could be outweighed by deduction limitations and other provisions included in further guidance and regulations.

NOTE K – INCOME TAXES

December 22, 2017,

the Tax Cuts and Jobs Act, (the “Tax Act”) was enacted which among other provisions, reduced the top corporate tax rate from

percent to a flat

percent beginning

January 1, 2018

and eliminated the corporate Alternative Minimum Tax. The Tax Act limits the deduction of business interest, net of interest income, to

percent of the adjusted taxable income of the taxpayer in any taxable year. Any amount disallowed under the limitation is treated as business interest paid or accrued in the following year. Disallowed interest will have an indefinite carryforward. The Tax Act also repeals the performance-based exception to the

$1.0

million deduction limitation on executive compensation and modifies the definition of “covered employees”. Additionally, the Tax Act intended to allow businesses to immediately expense the full cost of Qualified Improvement Property. However, the law as written does

not

permit restaurant companies to take advantage of the laws’ intention. Nathan’s determined that its blended federal tax rate was

31%

for its fiscal year ending

March 25, 2018,

as a result of the Tax Act.

The income tax provisions for the

thirty-nine

week periods ended

December 23, 2018

and

December 24, 2017

reflect effective tax rates of

27.8%

and

21.5%,

respectively. The Company’s tax rate reflects the reduction in our Federal income tax rate from

31%

21%

pursuant to the Tax Act. During the quarter ended

December 24, 2017,

pursuant to Staff Accounting Bulletin

#118,

Nathan’s determined reasonable estimates to its deferred assets and liabilities and pursuant to ASC

740,

Income Taxes, the Company recognized the effect(s) of the Tax Act on current and deferred income taxes in its financial statements. Nathan’s recorded the following discrete adjustment to its deferred tax liability and unrecognized tax benefits which reduced the provision for income taxes by

$436,000

1,510

BPS during the

thirty-nine

weeks ended

December 24, 2017,

lowering its effective tax rate from

36.6%

21.5%.

Nathan’s effective tax rates for the

thirty-nine

week periods ended

December 23, 2018

and

December 24, 2017

were also reduced by

BPS and

670

BPS, respectively, as a result of the tax benefits associated with stock compensation. For the

thirty-nine

week periods ended

December 23, 2018

and

December 24, 2017,

excess tax benefits of

$47,000

and

$194,000,

respectively, were reflected in the Consolidated Statements of Earnings as a reduction in determining the provision for income taxes.

The amount of unrecognized tax benefits at

December 23, 2018

was

$249,000

all of which would impact Nathan’s effective tax rate, if recognized. As of

December 23, 2018,

Nathan’s had

$242,000

of accrued interest and penalties in connection with unrecognized tax benefits.

January 2018,

Nathan’s received notification from the State of Virginia that it was seeking to review Nathan’s tax returns for the period

April 2014

through

March 2017.

The review has been completed; Nathan’s has accepted the findings and settled the matter in the

second

quarter fiscal

2019.

The effects of the review, which were

not

significant, have been factored into the Company’s effective tax rate for fiscal

2019.

Nathan’s estimates that its annual tax rate for the fiscal year ending

March 31, 2019

will be in the range of approximately

27.0%

29.0%

excluding the impact of any discrete items recorded and excess tax benefit associated with stock compensation. The final annual tax rate is subject to many variables, including the ultimate determination of revenue and income tax by state, among other factors, and cannot be determined until the end of the fiscal year; therefore, the actual tax rate could differ from our current estimates

In addition, the ultimate benefit of the Tax Act on Nathan’s is unclear as the lower annual tax rate could be outweighed by deduction limitations and other provisions included in further guidance and regulations.