For Bojangles, what was the computed 'expected' tax benefit for the year ended December 31, 2023?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
31, 2023 | | | Revenue recognized that was not included in the deferred revenue balance | | | as of December 31, 2023 | (53) | | Franchise fee refunds | (169) | | Increase due to cash received | 2,000 | | Deferred revenue, balance as of December 29, 2024 | 11,302 | | Less: Current portion of deferred revenue | (689) | | Noncurrent portion of deferred revenue | $ 10,613 |
Revenues expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) for fiscal years subsequent to December 29, 2024 are as follows:
| 2025 | $ 689 | |---------------------|--------------| | 2026 | 678 | | 2027 | 668 | | 2028 | 669 | | 2029 | 589 | | Thereafter | 8,009 $ 11,302 |
(dollars in thousands, except par values and per unit values)
11. Income Taxes
Income tax (expense) benefit is as follows:
| Years Ended | ||||||
|---|---|---|---|---|---|---|
| December 29, 2024 |
Source: Item 22 — CONTRACTS (FDD page 82)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, the computed "expected" tax benefit for the year ended December 31, 2023, was $5,039 (in thousands). This figure represents the initial tax benefit calculated before considering other factors that may increase or reduce the final income tax expense or benefit.
The FDD provides a breakdown of factors causing differences between the computed expected tax benefit and the actual income tax expense or benefit. For the year ended December 31, 2023, these factors included amortization of goodwill not deductible for income tax purposes (-$8,426), state and local income taxes net of federal income tax expense/benefit (-$1,552), work opportunity and welfare to work tax credits net of federal income tax expense ($718), disallowance of share-based compensation arrangements (-$139), meals and entertainment (-$45), and other net adjustments (-$1,836). These adjustments resulted in an overall income tax expense of -$6,241 for the year.
Prospective franchisees should understand that the "expected" tax benefit is a starting point and that various factors can significantly impact the final tax outcome. Reviewing these factors and understanding how they might affect their specific financial situation is crucial. Consulting with a financial advisor or tax professional is recommended to assess the potential tax implications for their Bojangles franchise.