Dunkin' Donuts 2012 Annual Report Download - page 93
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-83-
The components of the provision (benefit) for income taxes were as follows (in thousands):
Fiscal year ended
December 29,
2012
December 31,
2011
December 25,
2010
Current:
Federal $ 52,657 34,282 11,497
State 6,065 5,733 5,339
Foreign 2,601 3,719 4,138
Current tax provision $ 61,323 43,734 20,974
Deferred:
Federal $(5,071)(11,567)(16,916)
State 4,373 892 (10,397)
Foreign (6,248)(688)(1,076)
Deferred tax benefit (6,946)(11,363)(28,389)
Provision (benefit) for income taxes $ 54,377 32,371 (7,415)
The provision for income taxes from continuing operations differed from the expense computed using the statutory federal
income tax rate of 35% due to the following:
Fiscal year ended
December 29,
2012
December 31,
2011
December 25,
2010
Computed federal income tax expense, at statutory rate 35.0% 35.0% 35.0 %
Permanent differences:
Impairment of investment in BR Korea — 9.8 —
Other permanent differences 0.7 0.9 1.7
State income taxes 5.2 6.9 1.8
Benefits and taxes related to foreign operations (2.9)(6.8) (33.4)
Changes in enacted tax rates and apportionment 2.8 3.0 (27.2)
Uncertain tax positions (6.3) 1.9 (16.1)
Other (0.9)(2.2) 0.1
33.6% 48.5% (38.1)%
During fiscal year 2012, the Company recorded a net tax benefit of $10.2 million primarily related to the reversal of reserves
for uncertain tax positions, including interest and penalty, net of federal and state tax benefit as applicable, for which settlement
with the taxing authorities was reached, and recognized a deferred tax expense of $4.6 million due to estimated changes in
apportionment and enacted changes in future state income tax rates. The Company recognized deferred tax expense of $1.9
million in fiscal year 2011 due to enacted changes in future state income tax rates. In fiscal year 2010, the Company recognized
a deferred tax benefit of $5.7 million, due to changes in the estimated apportionment of income among the states in which the
Company earns income and enacted changes in future state income tax rates. These changes in estimates and enacted tax rates
affect the tax rate expected to be in effect in future periods when the deferred tax assets and liabilities reverse.