Papa Johns 2014 Annual Report Download - page 90

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77
15. Income Taxes (continued)
The reconciliation of income tax computed at the U.S. federal statutory rate to income tax expense for the
years ended December 28, 2014, December 29, 2013 and December 30, 2012 is as follows in both dollars
and as a percentage of income before income taxes ($ in thousands):
2012
Income Tax
Expense
Income
Tax Rate
Income Tax
Expense
Income
Tax Rate
Income Tax
Expense
Income
Tax Rate
2014
2013
Income taxes paid were $27.0 million in 2014, $29.3 million in 2013 and $25.3 million in 2012.
The Company files income tax returns in the U.S. federal jurisdiction and various states and foreign
jurisdictions. The Company, with few exceptions, is no longer subject to U.S. federal, state and local, or
non-U.S. income tax examinations by tax authorities for years before 2010. The Company is currently
undergoing examinations by various tax authorities. The Company anticipates that the finalization of
these current examinations and other issues could result in a decrease in the liability for unrecognized tax
benefits (and a decrease of income tax expense) of approximately $546,000 during the next 12 months.
The Company had $2.8 million of unrecognized tax benefits at December 28, 2014 of which, if
recognized, would affect the effective tax rate. A reconciliation of the beginning and ending liability for
unrecognized tax benefits is as follows (in thousands):
The Company recognizes accrued interest and penalties related to unrecognized tax benefits as a part of
income tax expense. The Company’s 2014 and 2013 income tax expense includes interest benefits of
$35,000 and $140,000, respectively. The Company has accrued approximately $674,000 and $707,000 for
the payment of interest and penalties as of December 28, 2014 and December 29, 2013, respectively.