Income Taxes

12 Months Ended

Feb. 03, 2024

Income Tax Disclosure [Abstract]

Income Taxes

Note 11 – Income Taxes

The provision for income taxes consisted of:

(In thousands)	2023		2022		2021
Current:
Federal	$	13,290	$	15,542	$	38,576
State		2,623		4,919		8,076
Puerto Rico		1,382		2,050		2,730
Total current		17,295		22,511		49,382
Deferred:
Federal		4,862		11,712		1,296
State and Puerto Rico		21		1,878		390
Total deferred		4,883		13,590		1,686
Valuation allowance		614		953		1,251
Total provision	$	22,792	$	37,054	$	52,319

Reconciliation between the statutory federal income tax rate and the effective income tax rate is as follows:

Fiscal years	2023			2022			2021
U.S. Federal statutory tax rate		21.0	%		21.0	%		21.0	%
State and local income taxes, net of federal tax    benefit		2.7			3.5			3.6
Puerto Rico		0.6			0.6			0.6
Excess tax benefit on stock-based compensation		(0.9	)		(0.4	)		(0.5	)
Other		0.3			0.5			0.6
Effective income tax rate		23.7	%		25.2	%		25.3	%

Deferred income taxes are the result of temporary differences in the recognition of revenue and expense for tax and financial reporting purposes. The sources of these differences and the tax effect of each are as follows:

(In thousands)	February 3, 2024			January 28, 2023
Deferred tax assets:
Lease obligations	$	86,175		$	83,473
Accrued compensation		4,513			4,496
Inventory		639			767
Other		4,641			4,639
Total deferred tax assets		95,968			93,375
Valuation allowance		(3,250	)		(2,635	)
Total deferred tax assets – net of valuation    allowance		92,718			90,740
Deferred tax liabilities:
Lease ROU assets		82,350			78,627
Property and equipment		22,769			19,673
Other		4,940			4,284
Total deferred tax liabilities		110,059			102,584
Net long-term liability	$	(17,341	)	$	(11,844	)

We have tax credit carryforwards associated with our Puerto Rico operations totaling $3.3 million at February 3, 2024 and $2.6 million at January 28, 2023. These credits expire at various times over the next ten years. We have taken a

full valuation allowance against these credits given they are not expected to be utilized due to the current differential between U.S. and Puerto Rico tax rates.

As of February 3, 2024 and January 28, 2023, there were no unrecognized tax liabilities or related accrued penalties or interest.