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Income Taxes
9 Months Ended
Mar. 31, 2019
Income Tax Disclosure [Abstract]  
Income Taxes

18.Income Taxes

On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was enacted by the U.S.  The Act implements comprehensive tax legislation which, among other changes, reduces the federal statutory corporate tax rate from 35% to 21% and implements a territorial tax system that eliminates the ability to credit certain foreign taxes.  Additionally, in December 2017, the Securities and Exchange Commission staff issued Staff Accounting Bulletin No. 118 (“SAB 118”), which addressed how a company recognized provisional amounts when a company did not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete its accounting for the effect of the changes in the Tax Act. The measurement period, as defined in SAB 118, ends when a company has obtained, prepared and analyzed the information necessary to finalize its accounting, but could not extend beyond one year.

Due to our June 30 fiscal year end, the lower United States income tax rates were phased in, resulting in a blended rate for our fiscal year 2018 and a 21% rate for years starting with our fiscal year 2019.  Based on the provisions of the Act, we re-measured our U.S. deferred tax assets and related valuation allowance and adjusted our estimated annual federal income tax rate to incorporate the lower corporate tax rate into our tax provision for the quarter the Act was enacted as the change represents a discrete item for purposes of income tax accounting.  The re-measurement of U.S. deferred tax assets and related valuation allowance at the lower enacted corporate tax rate resulted in a net change of zero.  

Furthermore, the new Act repealed the Alternative Minimum Tax (“AMT”) on corporations.  Any AMT credit carryforwards can be used to offset regular tax for any tax year and is refundable, subject to limitation in 2018 - 2021. With this change, we expect to be able to use or monetize the AMT credit within stated limitation period, and therefore, the valuation allowance recorded against the credit was removed in the second quarter of fiscal 2018.

The Act also imposed a tax on the untaxed foreign earnings of foreign subsidiaries of U.S. companies by deeming those earnings to be repatriated (the “Transition Tax”).  Generally, foreign earnings held in the form of cash and cash equivalents are taxed by the U.S. at a 15.5% rate and the remaining earnings are taxed at an 8% rate. The Transition Tax generally may be paid in installments over an eight-year period.  At the date of enactment, we were not in a position to present either a final or provisional estimate with respect to the Transition Tax.  As of June 30, 2018, we estimated the impact of the Transition Tax by incorporating assumptions made based upon our then-current interpretation and analysis of the Act. We completed our evaluation and related calculations during the second quarter of fiscal 2019, which confirmed our previous conclusion that our foreign tax credits would completely offset any Transition Tax calculated. As a result, we have not made any cash payments related to the Transition Tax.