Unrecognized tax benefits, accrued interest

  
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)At May 29, 2022, we had $2.2 million accrued for the payment of interest associated with unrecognized tax benefits.   
For U.S. federal income tax purposes, we participate in the IRS’s Compliance Assurance Process (CAP), whereby our U.S. federal income tax returns are reviewed by the IRS both prior to and after their filing. Income tax returns are subject to audit by state and local governments, generally years after the returns are filed. These returns could be subject to material adjustments or differing interpretations of the tax laws. The major jurisdictions in which the Company files income tax returns include the U.S. federal jurisdiction, Canada, and all states in the U.S. that have an income tax. With a few exceptions, the Company is no longer subject to U.S. federal income tax examinations by tax authorities for years before fiscal 2021, and state and local, or non-U.S. income tax examinations by tax authorities for years before fiscal 2017.The tax effects of temporary differences that give rise to deferred tax assets and liabilities are as follows: 

|  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |
| (in millions) | May 29, 2022 |  | May 30, 2021 |
| Accrued liabilities | $ | 80.0  |  |  | $ | 65.4  |  |
| Compensation and employee benefits | 123.6  |  |  | 120.4  |  |
|  |  |  |  |
| Lease liabilities | 1,227.3  |  |  | 1,189.3  |  |
| Net operating loss, credit and charitable contribution carryforwards | 121.0  |  |  | 195.5  |  |
| Other | 6.3  |  |  | 21.8  |  |
| Gross deferred tax assets | $ | 1,558.2  |  |  | $ | 1,592.4  |  |
| Valuation allowance | (20.8) |  |  | (26.6) |  |
| Deferred tax assets, net of valuation allowance | $ | 1,537.4  |  |  | $ | 1,565.8  |  |
| Trademarks and other acquisition related intangibles | (178.7) |  |  | (171.5) |  |
| Buildings and equipment | (402.1) |  |  | (492.9) |  |
| Capitalized software and other assets | (23.5) |  |  | (22.3) |  |
| Lease assets | (1,120.4) |  |  | (1,089.9) |  |
| Other | (13.8) |  |  | (10.8) |  |
| Gross deferred tax liabilities | $ | (1,738.5) |  |  | $ | (1,787.4) |  |
| Net deferred tax liabilities | $ | (201.1) |  |  | $ | (221.6) |  |

  
We have deferred tax assets of 63.8 million reflecting the benefit of state loss carryforwards, before federal benefit and valuation allowance, which expire at various dates between fiscal 2023 and fiscal 2041. We have deferred tax assets of $25.2 million of federal and $49.3 million state tax credits, before federal benefit and valuation allowance, which expire at various dates between fiscal 2023 and fiscal 2042.   
We have taken current and potential future expirations into consideration when evaluating the need for valuation allowances against these deferred tax assets. A valuation allowance for deferred tax assets is provided when it is more likely than not that some portion or all of the deferred tax assets will not be realized. Realization is dependent upon the generation of future taxable income or the reversal of deferred tax liabilities during the periods in which those temporary differences become deductible. We consider the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods in which our deferred tax assets are deductible, we believe it is more likely than not that we will realize the benefits of these deductible differences, net of the existing valuation allowances at May 29, 2022.NOTE 13 - RETIREMENT PLANS Defined Benefit Plans and Postretirement Benefit Plan As of December 2014, our non-contributory defined benefit pension plans were frozen and no additional benefits accrued for participants (except for continuing interest credits for eligible participants in the Cash Balance formula). In April 2018, our Benefit Plans Committee approved the termination of our primary non-contributory defined benefit pension plan (the Retirement Income Plan for Darden Restaurants, Inc.).  Plan participants who had not yet begun receiving their benefit payments were provided the opportunity to receive their full accrued benefits from plan assets by either (i) electing immediate lump sum distributions or annuities or (ii) deferring commencement of their benefits to a later date. During fiscal 2020, we made a funding contribution of approximately $12.7 million to fully fund the benefit obligation. As of May 31, 2020, all of the plan assets were either (i) distributed to settle the benefits for participants who selected the lump sum option or (ii) transferred to a third-party 70
