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Income Taxes | 12 Months Ended
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Aug. 25, 2018
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes Income tax expense consisted of the following:
| Year Ended
(In thousands) | August 25, 2018 |  | August 26, 2017 |  | August 27, 2016
Current |  |  |  |  |
Federal | $ | 28,874 |  |  | $ | 33,125 |  |  | $ | 14,293 |
State | 5,215 |  |  | 2,937 |  |  | 1,685 |
Total | 34,089 |  |  | 36,062 |  |  | 15,978 |
Deferred |  |  |  |  |
Federal | 5,123 |  |  | 926 |  |  | 4,280 |
State | 1,071 |  |  | 281 |  |  | 444 |
Total | 6,194 |  |  | 1,207 |  |  | 4,724 |
Income Tax Expense | $ | 40,283 |  |  | $ | 37,269 |  |  | $ | 20,702 |
The following table provides a reconciliation of the U.S. statutory income tax rate to our effective income tax rate:
| Year Ended
| August 25, 2018 |  |  | August 26, 2017 |  | August 27, 2016
U.S. federal statutory rate(1) | 25.9 | % |  | 35.0 | % |  | 35.0 | %
State taxes, net of federal benefit | 3.0 | % |  | 2.8 | % |  | 2.5 | %
Tax-free and dividend income | (0.4 | )% |  | (0.7 | )% |  | (1.3 | )%
Income tax credits | (0.5 | )% |  | (0.6 | )% |  | (1.1 | )%
Domestic production activities deduction | (2.2 | )% |  | (2.4 | )% |  | (2.5 | )%
Uncertain tax positions settlements and adjustments | 0.1 | % |  | (0.6 | )% |  | — | %
Impact from Tax Act | 2.6 | % |  | — | % |  | — | %
Other items | (0.3 | )% |  | 0.8 | % |  | (1.3 | )%
Effective tax provision rate | 28.2 | % |  | 34.3 | % |  | 31.3 | %
(1) | The U.S. federal statutory rate for the year ended August 25, 2018 is a blended rate, which includes the impact of the Tax Act enactment.
Our effective tax rate decreased to 28.2% for Fiscal 2018 from 34.3% for Fiscal 2017 due primarily to the enactment of the Tax Act on December 22, 2017. One of the most significant provisions of this legislation was a reduction in the Federal corporate income tax rate from 35.0% to 21.0% effective beginning January 1, 2018. Most of the remaining significant provisions of the Tax Act, such as the repeal of the federal domestic production activities deduction, take effect in our Fiscal 2019. ASU 2018-05, Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118, provided guidance for companies that allows for a measurement period of up to one year after the enactment date of the Tax Act to finalize the recording of the related tax impacts under ASC 740, Income Taxes. In accordance with this guidance, a company must reflect the income tax effect of those aspects of the Tax Act for which the accounting under ASC 740 is complete. To the extent that a company's accounting for certain income tax effects of the Tax Act is incomplete, but it is able to determine a reasonable estimate, the company must record a provisional estimate in the financial statements. In accordance with ASC 740, as of the date of enactment through the year ended August 25, 2018, we recorded a non-cash provisional estimate of $3.6 million to income tax expense and a corresponding increase in the net deferred tax asset as a result of revaluing all deferred tax assets and liabilities at the newly enacted Federal corporate income tax rate. We are still analyzing certain aspects of the Tax Act and refining our calculations, which could potentially affect the measurement of our deferred tax balances and cause us to revise our estimate in future periods. These impacts may be material, due to, among other things, further refinement of our calculations, changes in interpretations of the Tax Act, or issuance of additional guidance by the relevant tax authorities. The tax effects of temporary differences that give rise to deferred income taxes were as follows:
(In thousands) | August 25, 2018 |  | August 26, 2017
Deferred income tax asset (liability) |  |  |
Deferred compensation | $ | 4,730 |  |  | $ | 9,135 |
Warranty reserves | 9,842 |  |  | 11,675 |
Self-insurance reserve | 2,601 |  |  | 1,967 |
Accrued vacation | 1,298 |  |  | 2,142 |
Stock based compensation | 1,277 |  |  | 943 |
Inventory | 615 |  |  | — |
Unrecognized tax benefit | 584 |  |  | 437 |
Other(1) | 1,797 |  |  | 2,072 |
Total deferred tax assets | 22,744 |  |  | 28,371 |
Inventory | — |  |  | (1,919 | )
Intangibles | (21,292 | ) |  | (7,455 | )
Depreciation | (5,909 | ) |  | (6,261 | )
Total deferred tax liabilities | (27,201 | ) |  | (15,635 | )
Total deferred income tax (liabilities) assets, net | $ | (4,457 | ) |  | $ | 12,736 |
(1) | At August 25, 2018, other includes $1.4 million and $0.1 million related to federal and state net operating losses, respectively, that do not expire. We have evaluated all the positive and negative evidence and consider it more likely than not that these carryforwards can be realized.
It is our policy to recognize interest and penalties accrued relative to unrecognized tax benefits in income tax expense. Total reserves for uncertain tax positions were not material. We file a U.S. Federal tax return, as well as returns in various international and state jurisdictions. Although certain years are no longer subject to examination by the Internal Revenue Service ("IRS") and various state taxing authorities, net operating loss carryforwards generated in those years may still be adjusted upon examination by the IRS or state taxing authorities. As of August 25, 2018, our federal returns from Fiscal 2015 to present are subject to review by the IRS. With limited exception, state returns from Fiscal 2014 to present continue to be subject to review by state taxing jurisdictions. Several years may lapse before an uncertain tax position is audited and finally resolved and it is difficult to predict the outcome of such audits.

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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