INCOME TAXES |
3 Months Ended |
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Apr. 03, 2021 | |
| Income Tax Disclosure [Abstract] | |
| INCOME TAXES | INCOME TAXES The effective income tax rate for the three months ended March 2021 was 20.6% compared to 75.6% in the 2020 period. Discrete tax items had no net impact on the effective tax rate for the three months ended March 2021.
The three months ended March 2020 included a net discrete tax benefit of $7.7 million, primarily comprised of $6.3 million of tax benefit recognized due to the enactment of Swiss tax reform in the canton of Ticino and $0.9 million of tax benefit related to state tax return filings. The $7.7 million net discrete tax benefit in the three months ended March 2020 increased the effective income tax rate by 69.3%.
The effective income tax rate without discrete items for the three months ended March 2021 was 20.6% compared to 6.3% in the 2020 period. The increase was primarily due to changes in our jurisdictional mix of earnings and the relative impact of losses incurred for which no related tax benefit was recognized.
The Company files a consolidated U.S. federal income tax return, as well as separate and combined income tax returns in numerous state and international jurisdictions. In the U.S., the Company’s 2019 tax year remains open and is subject to examination by the Internal Revenue Service. In addition, the Company is currently subject to examination by various state and international tax authorities. Management regularly assesses the potential outcomes of both ongoing and future examinations for the current and prior years and has concluded that the Company's provision for income taxes is adequate. The outcome of any one examination is not expected to have a material impact on the Company’s financial statements.
During the three months ended March 2021, the amount of net unrecognized tax benefits and associated interest increased by $0.3 million to $13.7 million. Management also believes that it is reasonably possible that the amount of unrecognized tax benefits may decrease by $0.6 million within the next 12 fiscal months due to settlements of audits and expiration of statutes of limitations, all of which would reduce income tax expense.
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