Income Taxes:

The provision for income taxes consists of the following (in thousands):



	2015			2014			2013
Current tax expense:
Federal	$	225,253		$	211,383		$	175,039
State	17,419			25,133			19,129
Total current	242,672			236,516			194,168

Deferred tax (benefit) expense:
Federal	(7,017		)	(14,493		)	(5,341		)
State	1,567			(5,321		)	(2,968		)
Total deferred	(5,450		)	(19,814		)	(8,309		)
Total provision	$	237,222		$	216,702		$	185,859

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. Significant components of the deferred tax assets and liabilities are as follows (in thousands):



	2015			2014
Current tax assets:
Inventory valuation	$	18,147		$	16,602
Accrued employee benefit costs	21,368			18,770
Accrued sales tax audit reserve	2,316			2,053
Other	10,369			11,585
	52,200			49,010
Current tax liabilities:
Inventory basis difference	(3,497		)	(4,657		)
Prepaid expenses	(2,108		)	(2,109		)
Other	(625		)	(1,282		)
	(6,230		)	(8,048		)
Net current tax asset	$	45,970		$	40,962

Non-current tax assets:
Rent expenses in excess of cash payments required	29,179			27,166
Deferred compensation	20,125			17,956
Workers compensation insurance	7,233			6,989
General liability insurance	3,141			2,741
Lease exit obligations	2,378			2,437
Income tax credits	825			2,205
Accrued sales tax audit reserve	2,505			2,085
Other	3,274			3,745
	68,660			65,324
Non-current tax liabilities:
Depreciation	(55,805		)	(52,626		)
Other	(3,631		)	(3,916		)
	(59,436		)	(56,542		)
Net non-current tax asset	$	9,224		$	8,782

Net deferred tax asset	$	55,194		$	49,744

The Company has evaluated the need for a valuation allowance for all or a portion of the deferred tax assets. The Company believes that all of the deferred tax assets will more likely than not be realized through future earnings. The Company had state tax credit carryforwards of $4.4 million and $5.0 million as of December 26, 2015 and December 27, 2014, respectively, with varying dates of expiration between 2016 and 2025. The Company provided no valuation allowance as of December 26, 2015 and December 27, 2014 for state tax credit carryforwards, as the Company believes it is more likely than not that all of these credits will be utilized before their expiration dates.

A reconciliation of the provision for income taxes to the amounts computed at the federal statutory rate is as follows (in thousands):



	2015			2014			2013
Tax provision at statutory rate	$	226,666		$	205,656		$	179,933
Tax effect of:
State income taxes, net of federal tax benefits	12,341			12,878			10,505
Permanent differences	(1,785		)	(1,832		)	(4,579		)
	$	237,222		$	216,702		$	185,859

The Company and its affiliates file income tax returns in the U.S. and various state and local jurisdictions. With few exceptions, the Company is no longer subject to federal, state and local income tax examinations by tax authorities for years before 2011. Various states have completed an examination of our income tax returns for 2010 through 2013 with minimal adjustments.

The total amount of unrecognized tax positions that, if recognized, would decrease the effective tax rate, is $1.9 million at December 26, 2015. In addition, the Company recognizes current interest and penalties accrued related to these uncertain tax positions as interest expense, and the amount is not material to the Consolidated Statements of Income. The Company estimates the overall decrease in unrecognized tax positions in the next twelve months will range between $0.2 million and $0.6 million. A reconciliation of the beginning and ending gross amount of unrecognized tax positions (exclusive of interest and penalties) is as follows (in thousands):



	2015			2014			2013
Balance at beginning of year	$	3,500		$	2,482		$	5,898
Additions based on tax positions related to the current year	869			1,104			741
Additions for tax positions of prior years	—			280			—
Reductions for tax positions of prior years	(1,447		)	(366		)	(3,937		)
Reductions due to audit results	—			—			(220		)
Balance at end of year	$	2,922		$	3,500		$	2,482