INCOME TAX EXPENSE

9 Months Ended

Mar. 26, 2023

Income Tax Disclosure [Abstract]

INCOME TAX EXPENSE

INCOME TAX EXPENSE

The Company’s provision for income taxes and effective tax rate are as follows:

	Three Months Ended						Nine Months Ended
	March 26, 2023			March 27, 2022			March 26, 2023			March 27, 2022
	(in thousands, except percentages)
Income tax expense	$	124,914		$	112,917		$	537,201		$	437,857
Effective tax rate	13.3		%	10.0		%	12.7		%	11.4		%

The difference between the U.S. federal statutory tax rate of 21% and the Company’s effective tax rate for the three and nine months ended March 26, 2023 and March 27, 2022 was primarily due to income in lower tax jurisdictions.

The Internal Revenue Service (“IRS”) has examined the Company’s U.S. federal income tax return for the fiscal year ended June 24, 2018. As of September 25, 2022, the IRS has proposed adjustments resulting in a tax liability increase of approximately $50.0 million, which was previously reserved. The Company has agreed to pay the amount and has made a partial cash settlement in the September quarter with the remaining settlement expected to be paid based on the IRS requirements.

The IRS is examining the Company’s U.S. federal income tax returns for the fiscal years ended June 30, 2019, and June 28, 2020. As of March 26, 2023, no adjustments have been proposed by the IRS. The Company is unable to make a reasonable estimate as to when cash settlements, if any, with the IRS will occur.

The Company is in various stages of examinations in connection with all of its tax audits worldwide, and it is difficult to determine when these examinations will be settled. It is reasonably possible that over the next 12-month period the Company may experience an increase or decrease in its uncertain tax positions as a result of tax examinations or lapses of statutes of limitation. The change in uncertain tax positions as a result of lapses of statutes of limitation may range up to $18.3 million.