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Income Taxes | 12 Months Ended
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Sep. 30, 2017
Income Taxes | 13) Income Taxes Income tax expense is comprised of the following for the indicated periods (in thousands):
|  | Years Ended September 30, |
|  | 2017 |  |  | 2016 |  |  | 2015 |
Current: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 7,578 |  |  | $ | 18,724 |  |  | $ | 28,793 |
State |  |  | 2,664 |  |  |  | 5,344 |  |  |  | 8,143 |
Deferred |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | 8,775 |  |  |  | 7,485 |  |  |  | (3,719 | )
State |  |  | 1,359 |  |  |  | 2,185 |  |  |  | (382 | )
|  | $ | 20,376 |  |  | $ | 33,738 |  |  | $ | 32,835 |
The provision for income taxes differs from income taxes computed at the Federal statutory rate as a result of the following (in thousands):
|  | Years Ended September 30, |
|  | 2017 |  |  | 2016 |  |  | 2015 |
Income from continuing operations before taxes |  | $ | 47,276 |  |  | $ | 78,672 |  |  | $ | 70,391 |
Provision for income taxes: |  |  |  |  |  |  |  |  |  |  |  |
Tax at Federal statutory rate |  | $ | 16,546 |  |  | $ | 27,535 |  |  | $ | 24,637 |
Impact of Partnership loss not subject to federal income taxes |  |  | 741 |  |  |  | 477 |  |  |  | 3,228 |
State taxes net of federal benefit |  |  | 3,170 |  |  |  | 5,672 |  |  |  | 4,922 |
Permanent differences |  |  | 89 |  |  |  | 80 |  |  |  | 78 |
Deferred tax benefit |  |  | — |  |  |  | — |  |  |  | (3,179 | )
Change in valuation allowance |  |  | 115 |  |  |  | 26 |  |  |  | 3,027 |
Change in unrecognized tax benefit |  |  | — |  |  |  | — |  |  |  | 81 |
Other |  |  | (285 | ) |  |  | (52 | ) |  |  | 41 |
|  | $ | 20,376 |  |  | $ | 33,738 |  |  | $ | 32,835 |
The components of the net deferred taxes for the years ended September 30, 2017 and September 30, 2016 using current tax rates are as follows (in thousands):
|  | September 30, |
|  | 2017 |  |  | 2016 |
Deferred tax assets: |  |  |  |  |  |  |  |
Net operating loss carryforwards |  | $ | 5,374 |  |  | $ | 5,791 |
Vacation accrual |  |  | 3,542 |  |  |  | 3,367 |
Pension accrual |  |  | 7,455 |  |  |  | 8,549 |
Allowance for bad debts |  |  | 2,166 |  |  |  | 1,728 |
Insurance accrual |  |  | 19,914 |  |  |  | 25,828 |
Inventory capitalization |  |  | 895 |  |  |  | 1,128 |
Alternative minimum tax credit carryforward |  |  | — |  |  |  | 266 |
Other, net |  |  | 2,242 |  |  |  | 2,512 |
Total deferred tax assets |  |  | 41,588 |  |  |  | 49,169 |
Valuation allowance |  |  | (3,168 | ) |  |  | (3,053 | )
Net deferred tax assets |  | $ | 38,420 |  |  | $ | 46,116 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Property and equipment |  | $ | 8,001 |  |  | $ | 3,999 |
Fair value of derivative instruments |  |  | 1,683 |  |  |  | 788 |
Intangibles |  |  | 34,876 |  |  |  | 35,976 |
Total deferred tax liabilities |  | $ | 44,560 |  |  | $ | 40,763 |
Net deferred taxes |  | $ | (6,140 | ) |  | $ | 5,353 |
In order to fully realize the net deferred tax assets, the Company’s corporate subsidiaries will need to generate future taxable income. A valuation allowance is recognized if, based on the weight of available evidence including historical tax losses, it is more likely than not that some or all of deferred tax assets will not be realized. The net change in the total valuation allowance for the fiscal year ended September 30, 2017 was an increase of $115 thousand. The net change in the total valuation allowance for the fiscal year ended September 30, 2016 was an increase of $26 thousand. Based upon a review of a number of factors and all available evidence, including recent historical operating performance, the expectation of sustainable earnings, and the confidence that sufficient positive taxable income would continue in all tax jurisdictions for the foreseeable future, management concludes for the year ended September 30, 2017, it is more likely than not that the Company will realize the full benefit of its deferred tax assets, net of existing valuation allowance at September 30, 2017. As of January 1, 2017, Star Acquisitions, a wholly-owned subsidiary of the Company, had a Federal net operating loss carry forward (“NOLs”) of approximately $1.6 million. The Federal NOLs, which will expire between 2017 and 2030, are generally available to offset any future taxable income but are also subject to an annual limitation of $1.0 million. FASB ASC 740-10-05-6 Income Taxes, Uncertain Tax Position, provides financial statement accounting guidance for uncertainty in income taxes and tax positions taken or expected to be taken in a tax return. At September 30, 2017, we did not have unrecognized income tax benefits. Our continuing practice is to recognize interest and penalties related to income tax matters as a component of income tax expense. We file U.S. Federal income tax returns and various state and local returns. A number of years may elapse before an uncertain tax position is audited and finally resolved. For our Federal income tax returns we have four tax years subject to examination. In our major state tax jurisdictions of New York, Connecticut, and Pennsylvania we have four years that are subject to examination. In the state tax jurisdiction of New Jersey we have five tax years that are subject to examination. While it is often difficult to predict the final outcome or the timing of resolution of any particular uncertain tax position, based on our assessment of many factors including past experience and interpretation of tax law, we believe that our provision for income taxes reflect the most probable outcome. This assessment relies on estimates and assumptions and may involve a series of complex judgments about future events.

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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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