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Income Taxes | 12 Months Ended
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Oct. 31, 2017
Income Tax Disclosure [Abstract] |
Income Tax Disclosure [Text Block] | Income Taxes The following table provides a reconciliation of our effective tax rate from the federal statutory tax rate for the fiscal years ended October 31, 2017, 2016, and 2015 ($ amounts in thousands):
| 2017 |  | 2016 |  | 2015
| $ |  | %* |  | $ |  | %* |  | $ |  | %*
Federal tax provision at statutory rate | 285,009 |  |  | 35.0 |  |  | 206,159 |  |  | 35.0 |  |  | 187,447 |  |  | 35.0 |
State tax provision, net of federal benefit | 34,656 |  |  | 4.3 |  |  | 26,970 |  |  | 4.6 |  |  | 21,947 |  |  | 4.1 |
Domestic production activities deduction | (12,835 | ) |  | (1.6 | ) |  | (16,874 | ) |  | (2.9 | ) |  | (12,284 | ) |  | (2.3 | )
Other permanent differences | (1,468 | ) |  | (0.2 | ) |  | (7,037 | ) |  | (1.2 | ) |  | (7,821 | ) |  | (1.5 | )
Reversal of accrual for uncertain tax positions | (3,981 | ) |  | (0.5 | ) |  | (11,177 | ) |  | (1.9 | ) |  | (15,331 | ) |  | (2.9 | )
Accrued interest on anticipated tax assessments | 984 |  |  | 0.1 |  |  | 1,964 |  |  | 0.3 |  |  | 2,588 |  |  | 0.5 |
Increase in unrecognized tax benefits | — |  |  | — |  |  | 2,052 |  |  | 0.3 |  |  | 3,214 |  |  | 0.6 |
Valuation allowance — recognized | — |  |  | — |  |  | 1,018 |  |  | 0.2 |  |  | 3,681 |  |  | 0.7 |
Valuation allowance — reversed | (32,154 | ) |  | (3.9 | ) |  | — |  |  | — |  |  | (16,323 | ) |  | (3.0 | )
Other | 8,605 |  |  | 1.1 |  |  | 3,857 |  |  | 0.7 |  |  | 5,277 |  |  | 1.0 |
Income tax provision* | 278,816 |  |  | 34.2 |  |  | 206,932 |  |  | 35.1 |  |  | 172,395 |  |  | 32.2 |
* | Due to rounding, amounts may not add.
We currently operate in 20 states and are subject to various state tax jurisdictions. We estimate our state tax liability based upon the individual taxing authorities’ regulations, estimates of income by taxing jurisdiction, and our ability to utilize certain tax-saving strategies. Based on our estimate of the allocation of income or loss among the various taxing jurisdictions and changes in tax regulations and their impact on our tax strategies, we estimated our rate for state income taxes will be 6.5% in fiscal 2017. Our state income tax rate was 7.1% and 6.3% in fiscal 2016 and 2015, respectively. The following table provides information regarding the provision (benefit) for income taxes for each of the fiscal years ended October 31, 2017, 2016, and 2015 (amounts in thousands):
| 2017 |  | 2016 |  | 2015
Federal | $ | 278,095 |  |  | $ | 189,170 |  |  | $ | 181,819 |
State | 721 |  |  | 17,762 |  |  | (9,424 | )
| $ | 278,816 |  |  | $ | 206,932 |  |  | $ | 172,395 |
Current | $ | 93,106 |  |  | $ | 186,662 |  |  | $ | 122,953 |
Deferred | 185,710 |  |  | 20,270 |  |  | 49,442 |
| $ | 278,816 |  |  | $ | 206,932 |  |  | $ | 172,395 |
The components of income taxes payable at October 31, 2017 and 2016 are set forth below (amounts in thousands):
| 2017 |  | 2016
Current | $ | 33,100 |  |  | $ | 62,782 |
Deferred | 24,409 |  |  |
| $ | 57,509 |  |  | $ | 62,782 |
The following table provides a reconciliation of the change in the unrecognized tax benefits for the years ended October 31, 2017, 2016, and 2015 (amounts in thousands):
| 2017 |  | 2016 |  | 2015
Balance, beginning of year | $ | 30,272 |  |  | $ | 51,889 |  |  | $ | 58,318 |
Increase in benefit as a result of tax positions taken in prior years | 1,575 |  |  | 8,110 |  |  | 16,802 |
Increase in benefit as a result of tax positions taken in current year | 431 |  |  | 694 |  |  | 9,005 |
Decrease in benefit as a result of settlements | (9,174 | ) |  | (28,976 | ) |  | (31,013 | )
Decrease in benefit as a result of lapse of statute of limitations | (6,111 | ) |  | (1,445 | ) |  | (1,223 | )
Balance, end of year | $ | 16,993 |  |  | $ | 30,272 |  |  | $ | 51,889 |
The statute of limitations has expired on our federal tax returns for fiscal years through 2011 and our fiscal year 2013. Our unrecognized tax benefits are included in the current portion of “Income taxes payable” on our Consolidated Balance Sheets. If these unrecognized tax benefits reverse in the future, they would have a beneficial impact on our effective tax rate at that time. During the next 12 months, it is reasonably possible that the amount of unrecognized tax benefits will change, but we are not able to provide a range of such change. The anticipated changes will be principally due to the expiration of tax statutes, settlements with taxing jurisdictions, increases due to new tax positions taken, and the accrual of estimated interest and penalties. The amounts accrued for interest and penalties are included in the current portion of “Income taxes payable” on our Consolidated Balance Sheets. The following table provides information as to the amounts recognized in our tax provision, before reduction for applicable taxes and reversal of previously accrued interest and penalties, of potential interest and penalties in the 12-month periods ended October 31, 2017, 2016, and 2015, and the amounts accrued for potential interest and penalties at October 31, 2017 and 2016 (amounts in thousands):
Expense recognized in the Consolidated Statements of Operations and Comprehensive Income |
Fiscal year |
2017 | $ | 1,513 |
2016 | $ | 3,426 |
2015 | $ | 4,454 |
Accrued at: |
October 31, 2017 | $ | 5,179 |
October 31, 2016 | $ | 9,282 |
The components of net deferred tax assets and liabilities at October 31, 2017 and 2016 are set forth below (amounts in thousands):
| 2017 |  | 2016
Deferred tax assets: |  |  |
Accrued expenses | $ | 88,527 |  |  | $ | 103,134 |
Impairment charges | 84,534 |  |  | 113,950 |
Inventory valuation differences | 80,224 |  |  | 78,483 |
Stock-based compensation expense | 41,712 |  |  | 49,004 |
Amounts related to unrecognized tax benefits | 3,800 |  |  | 8,345 |
State tax, net operating loss carryforward | 48,343 |  |  | 50,031 |
Other | 1,303 |  |  | 6,329 |
Total assets | 348,443 |  |  | 409,276 |
Deferred tax liabilities: |  |  |
Capitalized interest | 76,914 |  |  | 85,873 |
Deferred income | 261,286 |  |  | 52,406 |
Expenses taken for tax purposes not for book | 9,878 |  |  | 47,045 |
Depreciation | 4,694 |  |  | 5,440 |
Deferred marketing | 20,080 |  |  | 18,945 |
Total liabilities | 372,852 |  |  | 209,709 |
Net deferred tax (liabilities)/assets before valuation allowances | (24,409 | ) |  | 199,567 |
Cumulative valuation allowance - state |  |  |  | (32,154 | )
Net deferred tax (liabilities)/assets | $ | (24,409 | ) |  | $ | 167,413 |
In accordance with GAAP, we assess whether a valuation allowance should be established based on our determination of whether it is more-likely-than-not that some portion or all of the deferred tax assets would not be realized. At October 31, 2017 and 2016, we determined that it was more-likely-than-not that our deferred assets would be realized for federal purposes. Accordingly, at October 31, 2017 and 2016, we did not record any valuation allowances against our federal deferred tax assets. We file tax returns in the various states in which we do business. Each state has its own statutes regarding the use of tax loss carryforwards. Some of the states in which we do business do not allow for the carryforward of losses, while others allow for carryforwards for 5 years to 20 years. For state tax purposes, we establish valuation allowances for deferred tax assets in certain jurisdictions where it is more-likely-than-not that the deferred tax asset would not be realized. Due to past and projected losses in certain jurisdictions where we did not have carryback potential and/or could not sufficiently forecast future taxable income, we recognized a net cumulative valuation allowance against our state deferred tax assets at October 31, 2016, as shown above. During fiscal 2016, and 2015, we recognized new valuation allowances of $1.0 million, and $3.7 million, respectively. We did not recognize any new valuation allowances in fiscal 2017. During fiscal 2017 and 2015, due to improved operating results, we reversed $32.2 million and $16.3 million of state deferred tax asset valuation allowances, respectively. No state deferred tax asset valuation allowances were reversed in fiscal 2016. Subsequent event In December 2017, Congress passed a federal tax reform bill. If signed into law by the President, this bill will change many longstanding foreign and domestic corporate and individual tax rules, as well as rules pertaining to the taxation of employee compensation and benefits. The legislation includes significant changes impacting domestic corporate taxpayers. We are currently evaluating the impact such changes would have on our consolidated financial statements and disclosures but preliminarily believe, if signed, it will significantly decrease our effective tax rate.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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