What was the U.S. federal statutory tax rate for Potbelly Sandwich Works in 2022?
Potbelly_Sandwich_Works Franchise · 2025 FDDAnswer from 2025 FDD Document
xes as a result of the following:
| 2024 | 2023 | 2022 | |
|---|---|---|---|
| U.S. federal statutory tax | 21.0% | 21.0% | 21.0% |
| Computed "expected" tax expense | $ 1,635 | $ 1,266 | $ 981 |
| Increase (reduction) resulting from: | |||
| Change in valuation allowance | (35,269) | (1,526) | 2,280 |
| Minority interest | (218) | 96 | 77 |
| Permanent differences | 1,477 | 805 | (1,755) |
| State and local income taxes, net of federal income tax effect | 295 | 793 | (287) |
| FICA and other tax credits | (487) | (297) | (559) |
| Equity compensation | (815) | 159 | (43) |
| Tax rate changes and other | (163) | (387) | (367) |
| Income tax (benefit) expe |
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 37–49)
What This Means (2025 FDD)
According to Potbelly Sandwich Works's 2025 Franchise Disclosure Document, the U.S. federal statutory tax rate was 21.0% in 2022. This rate is used to compute the expected tax expense for Potbelly Sandwich Works. The computed "expected" tax expense was $981 in 2022.
Several factors caused increases or reductions in the income tax expense. These included changes in valuation allowance ($2,280), minority interest ($77), permanent differences ($1,755), state and local income taxes net of federal income tax effect ($287), FICA and other tax credits ($559), equity compensation ($43), and tax rate changes and other ($367). The actual income tax expense for Potbelly Sandwich Works in 2022 was $327.
Prospective franchisees should understand that while the federal statutory tax rate provides a baseline, the actual tax expense can vary significantly due to a variety of factors. These fluctuations can impact the overall profitability of Potbelly Sandwich Works. Reviewing these factors can provide insight into the company's tax strategy and financial performance.