(10) Income Taxes

The components of the provision for income taxes are as follows:

	Year Ended
	October 3,			September 27,			September 28,
(Dollars in thousands)	2015			2014			2013
Provision for income taxes:
Current:
Federal	$	10,149		$	8,196		$	2,124
State		772			330			257
		10,921			8,526			2,381
Deferred:
Federal		222			(323	)		3,571
State		111			364			310
		333			41			3,881

Income taxes	$	11,254		$	8,567		$	6,262

Effective income tax rate		34.1	%		34.0	%		34.8	%

The reconciliation between income taxes computed at the federal statutory rate and the provision for income taxes is as follows:

	Year Ended
(Dollars in thousands)	October 3, 2015					September 27, 2014					September 28, 2013
Provision for income taxes at federal statutory rate	$	11,537		35.0	%	$	8,823		35.0	%	$	6,299		35.0	%
Qualified production activities deduction		(1,005	)	(3.0	)		(755	)	(3.0	)		(165	)	(0.9	)
Valuation allowance		(55	)	(0.2	)		(183	)	(0.7	)		51		0.3
State income taxes, net of federal tax benefit		612		1.9			577		2.3			479		2.7
Nondeductible stock option expense		28		0.0			30		0.1			(51	)	(0.3	)
Other, net		137		0.4			75		0.3			(351	)	(2.0	)
Provision for income taxes	$	11,254		34.1	%	$	8,567		34.0	%	$	6,262		34.8	%

The components of deferred tax assets and liabilities are as follows:

	October 3,			September 27,
(In thousands)	2015			2014
Deferred tax assets:
Defined benefit plans	$	3,755		$	3,419
Accrued expenses and asset reserves		2,596			2,782
Stock-based compensation		2,054			1,804
State net operating loss carryforwards and tax credits		658			908
Goodwill, amortizable for tax purposes		559			870
Valuation allowance		(492	)		(547	)
Deferred tax assets		9,130			9,236

Deferred tax liabilities:
Plant and equipment		(12,285	)		(12,654	)
Prepaid insurance and other reserves		(1,410	)		(1,032	)
Deferred tax liabilities		(13,695	)		(13,686	)
Net deferred tax liability	$	(4,565	)	$	(4,450	)

As of October 3, 2015, the Company recorded a current deferred tax asset (net of valuation allowance) of $1.5 million on its consolidated balance sheet in other current assets and a non-current deferred tax liability (net of valuation allowance) of $6.1 million in other liabilities. As of September 27, 2014, the Company recorded a current deferred tax asset (net of valuation allowance) of $2.1 million in other current assets and a non-current deferred tax liability (net of valuation allowance) of $6.6 million in other liabilities. The Company has $9.3 million of state operating loss carryforwards that begin to expire in 2017, but principally expire between 2017 and 2031. The Company has also recorded deferred tax assets for various state tax credits of $178,000, which will begin to expire in 2016 and principally expire between 2016 and 2020.

The realization of the Company’s deferred tax assets is entirely dependent upon the Company’s ability to generate future taxable income in applicable jurisdictions. GAAP requires that the Company periodically assess the need to establish a valuation allowance against its deferred tax assets to the extent the Company no longer believes it is more likely than not that they will be fully utilized. As of October 3, 2015, the Company had recorded a valuation allowance of $492,000 pertaining to various state NOLs and tax credits that were not expected to be utilized. The valuation allowance established by the Company is subject to periodic review and adjustment based on changes in facts and circumstances and would be reduced should the Company utilize the state net operating loss carryforwards against which an allowance had previously been provided or determine that such utilization is more likely than not. The $55,000 decrease in the valuation allowance during 2015 is primarily due to reduced state income tax rates.

As of October 3, 2015, the Company has no material, known tax exposures that require the establishment of contingency reserves for uncertain tax positions.

The Company classifies interest and penalties related to unrecognized tax benefits as part of income tax expense. There were no interest and penalties related to unrecognized tax benefits incurred during 2015, 2014 and 2013.

The Company files U.S. federal income tax returns as well as state and local income tax returns in various jurisdictions. Federal and various state tax returns filed by the Company subsequent to 2010 remain subject to examination together with certain state tax returns filed by the Company subsequent to 2003.