Income Taxes (Tables)

12 Months Ended

Dec. 30, 2023

For fiscal 2023, fiscal 2022, and fiscal 2021, the Company’s effective income tax rate was 40.7 percent, 25.0 percent, and 24.8 percent, respectively.


	Fiscal Year Ended December 30, 2023			Fiscal Year Ended December 31, 2022			Fiscal Year Ended January 1, 2022
	($ amounts in thousands)
Income before provision for income taxes	$	81,886		$	394,761		$	393,876

Federal income taxes:
Current	$	20,221		$	75,617		$	78,005
Deferred	7,993			3,184			(1,585)
State income taxes:
Current	5,373			17,679			19,382
Deferred	(237)			2,105			1,941
Provision for income taxes	$	33,350		$	98,585		$	97,743

Effective tax rate	40.7		%	25.0		%	24.8		%

Schedule of Provision for Income Taxes is Reconciled to the Federal Statutory

The Company’s provisions for income taxes are reconciled to the federal statutory amounts as follows:


	Fiscal Year Ended December 30, 2023		Fiscal Year Ended December 31, 2022		Fiscal Year Ended January 1, 2022
	(In thousands)
Federal income taxes computed at the federal statutory tax rate	$	17,196	$	82,898	$	82,628
State income taxes, net of federal benefit	4,609		16,171		18,970
Valuation allowance change arising from state net operating losses	(621)		(193)		(3,018)

Pension plan settlement (1)	12,150		—		—
Uncertain tax positions	(356)		(333)		91
Permanent differences arising from compensation	746		(71)		686
Other	(374)		113		(1,614)
Provision for income taxes	$	33,350	$	98,585	$	97,743

(1) $4.5 million was reclassified from accumulated other comprehensive income (loss)

Schedule of Net Deferred Income Tax Assets (Liabilities)

For fiscal 2023 and fiscal 2022, components of the Company’s deferred income tax assets and deferred income tax liabilities are as follows:


	December 30, 2023		December 31, 2022
	(In thousands)
Deferred income tax assets:
Inventory reserves	$	3,965	$	5,268
Compensation-related accruals	7,794		5,807
Accounts receivable	708		612

Property and equipment	41,308		44,870
Operating lease liability	10,086		13,134
Pension plans	2,832		2,885
Benefit from net operating loss carryovers	4,317		4,995
Other	220		397
Total gross deferred income tax assets	71,230		77,968
Less: valuation allowances	(3,456)		(4,076)
Total net deferred income tax assets	$	67,774	$	73,892

Deferred income tax liabilities:
Intangible assets	$	(4,335)	$	(4,559)
Operating lease asset	(9,227)		(12,250)
Other	(956)		(914)
Total deferred income tax liabilities	(14,518)		(17,723)
Deferred income tax asset, net	$	53,256	$	56,169

Schedule of Activity in Deferred Tax Asset Valuation Allowance

Activity in the Company’s deferred tax asset valuation allowance for fiscal 2023 and 2022 was as follows:


	December 30, 2023		December 31, 2022
	(In thousands)
Balance as of beginning of the fiscal year	$	4,076	$	4,269
Valuation allowance increases (decreases) related to:
State net operating loss carryforwards	(620)		(193)
Balance as of end of the fiscal year	$	3,456	$	4,076

Schedule of Activity Related to Unrecognized Tax Benefits

The following table summarizes the activity related to our gross unrecognized tax benefits:


	December 30, 2023		December 31, 2022
	(In thousands)
Balance at beginning of the fiscal year	$	1,872	$	2,205
Additions for tax positions of current year	1,765		—
Reductions due to lapse of applicable statute of limitations	(356)		(333)
Balance at end of the fiscal year	$	3,281	$	1,872

BlueLinx Holdings Inc. 10-K