Annual report pursuant to Section 13 and 15(d)

INCOME TAXES (Tables)

v3.7.0.1
INCOME TAXES (Tables)
 12 Months Ended
Jan. 28, 2017
Income Tax Disclosure [Abstract]  
Income Tax Expense (Benefit), Intraperiod Tax Allocation Table
Total income taxes were allocated as follows:
 
 
Year Ended
(in millions)
 
January 28, 2017
 
January 30, 2016
 
January 31, 2015
Income from continuing operations
 
$
433.2

 
$
165.8

 
$
355.0

Shareholders' equity, tax benefit on exercises/vesting of equity-based
compensation
 
—

 
(12.8
)
 
(4.5
)
 
 
$
433.2

 
$
153.0

 
$
350.5

Income tax provision (benefit) Table
The provision for income taxes consists of the following: 
 
 
Year Ended
 
 
January 28,
 
January 30,
 
January 31,
(in millions)
 
2017
 
2016
 
2015
Federal - current
 
$
480.5

 
$
126.9

 
$
325.1

State - current
 
79.5

 
14.6

 
47.6

Foreign - current
 
0.8

 
0.5

 
0.4

Total current
 
560.8

 
142.0

 
373.1

 
 
 
 
 
 
 
Federal - deferred
 
(37.7
)
 
7.4

 
(9.7
)
State - deferred
 
(89.9
)
 
3.3

 
(3.2
)
Foreign - deferred
 
—

 
13.1

 
(5.2
)
Total deferred
 
$
(127.6
)
 
$
23.8

 
$
(18.1
)
Federal statutory tax rate reconciliation Table
A reconciliation of the statutory federal income tax rate and the effective rate follows: 
 
 
Year Ended
 
 
January 28, 2017
 
January 30, 2016
 
January 31, 2015
Statutory tax rate
 
35.0
 %
 
35.0
 %
 
35.0
 %
Effect of:
 
 

 
 

 
 

State and local income taxes, net of federal income tax benefit
 
3.0

 
3.0

 
3.3

Work Opportunity Tax Credit
 
(1.6
)
 
(3.8
)
 
(1.0
)
State tax election
 
(1.4
)
 
—

 
—

Deferred tax rate change
 
(1.6
)
 
—

 
—

Incremental tax benefit of exercises/vesting of equity-based
compensation
 
(0.6
)
 
—

 
—

International taxes
 
—

 
(4.5
)
 
—

Change in valuation allowance
 
0.1

 
4.1

 
—

Nondeductible acquisition costs
 
—

 
1.5

 
—

Other, net
 
(0.3
)
 
1.7

 
(0.1
)
Effective tax rate
 
32.6
 %
 
37.0
 %
 
37.2
 %
Components of Deferred Tax Assets and Liabilities Table
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. All deferred tax assets and liabilities are classified on the accompanying consolidated balance sheets as noncurrent in accordance with ASU 2015-17 "Income Taxes (Topic 740)" and are netted based on taxing jurisdiction.  
Significant components of the Company's net deferred tax assets (liabilities) follow:
(in millions)
 
January 28,
2017
 
January 30,
2016
Deferred tax assets:
 
 
 
 
Deferred rent
 
$
59.9

 
$
47.3

Accrued expenses
 
71.4

 
73.2

Net operating losses and credit carryforwards
 
71.4

 
53.1

Accrued compensation expense
 
71.3

 
77.8

State tax election
 
20.4

 
—

Other
 
3.4

 
0.3

Total deferred tax assets
 
297.8

 
251.7

Valuation allowance
 
(49.7
)
 
(48.4
)
Deferred tax assets, net
 
248.1

 
203.3

Deferred tax liabilities:
 
 

 
 

Property and equipment
 
(331.3
)
 
(369.3
)
Other intangibles
 
(1,368.7
)
 
(1,415.9
)
Prepaid expenses
 
—

 
(3.3
)
Inventory
 
(7.0
)
 
(1.4
)
Total deferred tax liabilities
 
(1,707.0
)
 
(1,789.9
)
Net deferred tax liability
 
$
(1,458.9
)
 
$
(1,586.6
)
Reconciliation of Unrecognized Tax Benefits Table
The following is a reconciliation of the Company’s total gross unrecognized tax benefits:
(in millions)
 
January 28, 2017
 
January 30, 2016
Beginning Balance
 
$
71.4

 
$
6.5

Additions, Acquisition of Family Dollar
 
—

 
64.4

Additions, based on tax positions related to current year
 
5.9

 
1.9

Additions for tax positions of prior years
 
3.7

 
1.6

Settlements
 
(2.2
)
 
(1.8
)
Lapses in statutes of limitation
 
(7.6
)
 
(1.2
)
Ending balance
 
$
71.2

 
$
71.4