Note 7 – Income taxes:

The provision for income taxes and the difference between such provision for income taxes and the amount that would be expected using the U.S. federal statutory income tax rate of 35% are presented below. All of our pre-tax income relates to operations in the United States.

	Years ended December 31,
	2014			2015			2016
	(In thousands)
Provision for income taxes:
Currently payable	$	4,544		$	4,778		$	5,621
Deferred income tax expense (benefit)		468			125			(114	)
Total	$	5,012		$	4,903		$	5,507
Expected tax expense, at the U.S. federal statutory income tax rate of 35%	$	4,787		$	4,908		$	5,588
State income taxes		604			387			388
Domestic production activities deduction		(378	)		(415	)		(495	)
Valuation allowance		(24	)		-			-
Other, net		23			23			26
Total	$	5,012		$	4,903		$	5,507

The components of the net deferred tax liability are summarized below.

	December 31,
	2015			2016
	(In thousands)
Tax effect of temporary differences related to:
Inventories	$	538		$	507
Property and equipment		(4,650	)		(4,468	)
Accrued liabilities and other deductible differences		45			110
Accrued employee benefits		1,695			1,592
Other deductible differences		4			4
Goodwill		(2,625	)		(2,625	)
Other taxable differences		(8	)		(7	)
Total deferred tax liability	$	(5,001	)	$	(4,887	)

We previously had certain U.S. state net operating loss carryforwards, the benefit of which we had not recognized under the more-likely-than-not recognition criteria. We utilized all of the remaining state net operating loss carryforward in 2014. Our provision for income taxes includes a benefit of $24,000 in 2014 related to changes in the deferred tax asset valuation allowance associated with such carryforwards.

We and Contran file income tax returns in U.S. federal and various state and local jurisdictions. Our income tax returns prior to 2013 are generally considered closed to examination by applicable tax authorities.