Note 12 - Income Taxes
|9 Months Ended
Dec. 25, 2021
|Notes to Financial Statements
|Income Tax Disclosure [Text Block]
Note 12. Income Taxes
The Company accounts for income taxes using the asset and liability method as codified in Topic 740. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards.
The Company recorded $10,000 and $2,000 in income tax expense for the nine months ended December 25, 2021 and December 26, 2020 respectively. The effective tax rate for the nine months ended December 25, 2021 was 1% and for the nine months ended December 26, 2020 was 0%, primarily due to a valuation allowance recorded against the net deferred tax asset balance.
As of December 25, 2021, the Company had recorded $52,000 for unrecognized tax benefits related to uncertain tax positions. The unrecognized tax benefit is netted against the non-current deferred tax asset on the Condensed Consolidated Balance Sheet. The Company does expect the liability for unrecognized tax benefits to change materially during the next 12 months as a result of the Exchange Agreement (See Note 16 – Subsequent Events).
The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef