Income Taxes |
9 Months Ended |
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Sep. 28, 2024 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | Income Taxes The Company determines its income taxes for interim reporting periods by applying the Company’s estimated annual effective tax rate to the year-to-date results, adjusted for tax items discrete to each period.
For the three and nine months ended September 28, 2024, the Company recorded an income tax benefit of $27 million and $38 million representing an effective tax rate of (3.6)% and (3.3)%, respectively. The difference between the U.S. federal statutory tax rate of 21% and the Company's estimated annual effective tax rate was primarily due to the income tax benefit from foreign-derived intangible income (FDII) and research and development (R&D) tax credits, partially offset by the tax rate detriment from foreign earnings. The tax benefit for the three and nine months ended September 28, 2024 reflected discrete tax benefits of $28 million and $68 million, respectively, primarily related to stock-based compensation, partially offset by the interest and penalties accrued for uncertain tax positions.
For the three months and nine months ended September 30, 2023, the Company recorded an income tax benefit of $39 million and $49 million representing an effective tax rate of (15.2)% and (35.8)%, respectively. The difference between the U.S. federal statutory tax rate of 21% and the Company's estimated annual effective tax rate was primarily due to the income tax benefit from FDII and R&D tax credits. The tax benefit for the three months ended September 30, 2023 reflected a discrete tax benefit of $17 million primarily related to tax effects of stock-based compensation. The tax benefit for the nine months ended September 30, 2023, reflected a discrete tax benefit of $29 million primarily related to tax effects of stock-based compensation, partially offset by interest and penalties accrued for uncertain tax positions.
As of September 28, 2024 and December 30, 2023, the Company had long-term income tax liabilities related to unrecognized tax benefits of $1.5 billion and $1.4 billion recorded under Other long-term liabilities in the balance sheet.
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