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Income Taxes
 12 Months Ended
Sep. 29, 2012
Income Taxes [Abstract]  
Income Taxes

2. Income Taxes

 

Deferred Income Tax Liabilities and Assets—Deferred income taxes are determined based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax laws and rates. Significant components of the Company’s deferred tax liabilities and assets are as follows:

 

                 
    2012     2011  

Deferred tax liabilities:

                

Property and equipment tax/book differences

   $ 86,915,000     $ 70,435,000  

Property tax method

     1,441,000       1,359,000  
   

 

 

    

 

 

  

Total deferred tax liabilities

     88,356,000       71,794,000  
   

 

 

    

 

 

  

Deferred tax assets:

                

Insurance reserves

     7,927,000       7,469,000  

Advance payments on purchases contracts

     699,000       389,000  

Vacation accrual

     2,420,000       2,331,000  

Closed store accrual

     197,000       513,000  

Inventory

     1,836,000       638,000  

Deferred compensation

     2,220,000       1,739,000  

Other

     1,722,000       1,582,000  
   

 

 

    

 

 

  

Total deferred tax assets

     17,021,000       14,661,000  
   

 

 

    

 

 

  

Net deferred tax liabilities

   $ 71,335,000     $ 57,133,000  
   

 

 

    

 

 

  

 

Current deferred income tax benefits of $12.8 million and $10.8 million at September 29, 2012 and September 24, 2011, respectively, included in other current assets, result from timing differences arising from deferred vendor income, vacation pay, non-income taxes, self-insurance reserves, and from capitalization of certain overhead costs in inventory for tax purposes.

 

At September 29, 2012 and September 24, 2011 refundable current income taxes totaling $14.2 million and $2.6 million, respectively, are included in the line item “Other current assets” on the Consolidated Balance Sheets.

 

Income Tax Expense—Income tax expense differs from the amounts computed by applying the statutory federal rates to income before income taxes. The reasons for the differences are as follows:

 

                         
    2012     2011     2010  

Federal tax at statutory rate

   $ 23,572,000     $ 21,249,000     $ 17,086,000  

State income tax, net of federal tax benefits

     1,943,000       2,145,000       2,629,000  

Federal tax credits

     (1,209,000 )      (1,824,000 )      (1,480,000 ) 

Other

     (403,000 )      81,000       (260,000 ) 
   

 

 

    

 

 

    

 

 

  

Total

   $ 23,903,000     $ 21,651,000     $ 17,975,000  
   

 

 

    

 

 

    

 

 

  

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Current and deferred income tax expense (benefit) is as follows:

 

                         
    2012     2011     2010  

Current:

                        

Federal

   $ 6,734,000     $ 23,664,000     $ 10,377,000  

State

     2,967,000       3,939,000       2,474,000  
   

 

 

    

 

 

    

 

 

  

Total current

     9,701,000       27,603,000       12,851,000  
   

 

 

    

 

 

    

 

 

  

Deferred:

                        

Federal

     12,149,000       (5,040,000 )      4,856,000  

State

     2,053,000       (912,000 )      268,000  
   

 

 

    

 

 

    

 

 

  

Total deferred

     14,202,000       (5,952,000 )      5,124,000  
   

 

 

    

 

 

    

 

 

  

Total expense

   $ 23,903,000     $ 21,651,000     $ 17,975,000  
   

 

 

    

 

 

    

 

 

  

 

Uncertain Tax Positions—Under ASC 740-10 “Accounting for Uncertainty in Income Taxes”, the Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the “more likely than not” threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. A reserve for uncertain tax positions, including interest and penalties, of $0.2 million is included in the Company’s income taxes payable at both September 29, 2012 and September 24, 2011. The reserve for uncertain tax positions has been recorded based on management’s assumptions that certain tax positions would be successfully challenged by taxing authorities.