Note 5 - Income Taxes |
3 Months Ended |
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Apr. 04, 2026 | |
| Notes to Financial Statements | |
| Income Tax Disclosure [Text Block] |
Note 5 – Income Taxes
For the fiscal quarter ended April 4, 2026, the Company reported tax expenses, and its effective tax rate was (81.4%) compared to the fiscal quarter ended March 29, 2025, where the Company reported tax benefits, and its effective tax rate was 25.8%.
The effective tax rate for the fiscal quarter ended April 4, 2026 differs from the federal statutory rate of 21% due to foreign income taxed at different tax rates and changes in our valuation allowance on deferred tax assets. The effective tax rate for the fiscal quarter ended March 29, 2025 differs from the federal statutory rate of 21% due to foreign income taxed at different tax rates and changes in our valuation allowance on deferred tax assets.
The Company and its subsidiaries are subject to income taxes imposed by the U.S., various states, and the foreign jurisdictions in which we operate. Each jurisdiction establishes rules that set forth the years which are subject to examination by its tax authorities. While the Company believes the tax positions taken on its tax returns for each jurisdiction are supportable, they may still be challenged by the jurisdiction's tax authorities. In anticipation of such challenges, the Company has established reserves for tax-related uncertainties. These liabilities are based on the Company’s best estimate of the potential tax exposures in each respective jurisdiction. It may take a number of years for a final tax liability in a jurisdiction to be determined, particularly in the event of an audit. If an uncertain matter is determined favorably, there could be a reduction in the Company’s tax expense. An unfavorable determination could increase tax expense and could require a cash payment, including interest and penalties.
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