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Income Taxes | 12 Months Ended
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Aug. 31, 2019
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes Income tax expense consisted of the following:
(in thousands) | 2019 |  | 2018 |  | 2017
Current |  |  |  |  |
Federal | $ | 16,433 |  |  | $ | 28,874 |  |  | $ | 33,125 |
State | 3,138 |  |  | 5,215 |  |  | 2,937 |
Total | 19,571 |  |  | 34,089 |  |  | 36,062 |
Deferred |  |  |  |  |
Federal | 6,395 |  |  | 5,123 |  |  | 926 |
State | 1,145 |  |  | 1,071 |  |  | 281 |
Total | 7,540 |  |  | 6,194 |  |  | 1,207 |
Provision for income taxes | $ | 27,111 |  |  | $ | 40,283 |  |  | $ | 37,269 |
The following table provides a reconciliation of the U.S. statutory income tax rate to our effective income tax rate:
| 2019 |  | 2018 |  | 2017
U.S. federal statutory rate(1) | 21.0 | % |  | 25.9 | % |  | 35.0 | %
State taxes, net of federal benefit | 2.9 | % |  | 3.0 | % |  | 2.8 | %
Impact from Tax Act | — | % |  | 2.6 | % |  | — | %
Domestic production activities deduction | — | % |  | (2.2 | )% |  | (2.4 | )%
Income tax credits | (4.5 | )% |  | (0.5 | )% |  | (0.6 | )%
Tax-free and dividend income | (0.5 | )% |  | (0.4 | )% |  | (0.7 | )%
Uncertain tax position settlements and adjustments | 0.9 | % |  | 0.1 | % |  | (0.6 | )%
Other items | (0.3 | )% |  | (0.3 | )% |  | 0.8 | %
Effective tax provision rate | 19.5 | % |  | 28.2 | % |  | 34.3 | %
(1) | The U.S. federal statutory rate for Fiscal 2018 is a blended rate, which includes the impact of the Tax Act enactment.
Our effective tax rate decreased to 19.5% for Fiscal 2019 from 28.2% for Fiscal 2018 due to the enactment of the 2017 Tax Cuts and Jobs Act ("Tax Act") on December 22, 2017 and net favorable discrete items, primarily attributable to R&D-related tax credits, which totaled $3.6 million or 2.6%. 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, we recorded non-cash provisional estimates of $3.6 million to income tax expense in Fiscal 2018 as a result of revaluing all deferred tax assets and liabilities at the newly enacted Federal corporate income tax rate. We made no measurement period adjustments related to these items during Fiscal 2019 and are complete in analyzing and recording all aspects of the enactment of the Tax Act. The tax effects of temporary differences that give rise to deferred income taxes were as follows:
(in thousands) | August 31, 2019 |  | August 25, 2018
Warranty reserves | $ | 10,949 |  |  | $ | 9,842 |
Deferred compensation | 3,989 |  |  | 4,730 |
Self-insurance reserve | 2,617 |  |  | 2,601 |
Stock-based compensation | 2,558 |  |  | 1,277 |
Accrued vacation | 1,227 |  |  | 1,298 |
Unrecognized tax benefit | 444 |  |  | 584 |
Inventory | — |  |  | 615 |
Other(1) | 3,337 |  |  | 1,797 |
Total deferred tax assets | 25,121 |  |  | 22,744 |
Intangibles | 28,055 |  |  | 21,292 |
Depreciation | 8,192 |  |  | 5,909 |
Inventory | 906 |  |  | — |
Total deferred tax liabilities | 37,153 |  |  | 27,201 |
Total deferred income tax liabilities, net | $ | 12,032 |  |  | $ | 4,457 |
(1) | At August 31, 2019, other includes $0.6 million and $0.4 million related to federal and state net operating losses, respectively. At August 25, 2018, other includes $1.4 million and $0.1 million related to federal and state net operating losses, respectively. These net operating losses 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.
Changes in the unrecognized tax benefits are as follows:
(in thousands) | 2019 |  | 2018 |  | 2017
Balance at beginning of year | $ | 1,220 |  |  | $ | 1,195 |  |  | $ | 1,710 |
Gross increases (decreases)-tax positions in a prior year | 1,173 |  |  | 25 |  |  | (536 | )
Gross increases-current year tax positions | 429 |  |  | — |  |  | 21 |
Balance at end of year | 2,822 |  |  | 1,220 |  |  | 1,195 |
Accrued interest and penalties | 769 |  |  | 525 |  |  | 411 |
Total unrecognized tax benefits | $ | 3,591 |  |  | $ | 1,745 |  |  | $ | 1,606 |
The amount of unrecognized tax benefits is not expected to change materially within the next 12 months. If the remaining uncertain tax positions are ultimately resolved favorably, $2.8 million of unrecognized tax benefits would have a positive impact on our effective tax rate. It is our policy to recognize interest and penalties accrued relative to unrecognized tax benefits in income tax expense. 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 31, 2019, our federal returns from Fiscal 2016 to present are subject to review by the IRS. With limited exception, state returns from Fiscal 2015 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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