10. INCOME TAXES

The components of income tax expense were as follows:


	Fiscal Year Ended


	February 2, 2020		February 3, 2019		January 28, 2018
(in thousands)
Current:
Federal	$	4,727	$	(589)	$	9,118
State		1,308		1,040		2,227
		6,035		451		11,345
Deferred:
Federal		(568)		6,971		658
State		(38)		1,028		(125)
		(606)		7,999		533
Total income tax expense	$	5,429	$	8,450	$	11,878

In December 2017, the United Sates enacted new federal comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act significantly revised the U.S. corporate income tax regime by, among other things, lowering the corporate tax rate from 35% to 21% effective January 1, 2018 (the “Effective Date”). When a U.S. federal tax rate change occurs during a fiscal year, taxpayers are required to compute a weighted daily average rate for the fiscal year of enactment. As a result of the Tax Act, the Company calculated a U.S. federal statutory corporate income tax rate of 33.9% for the fiscal year 2017. The U.S. federal statutory corporate income tax rate of 33.9% was the weighted daily average rate between the pre-enactment U.S. federal statutory tax rate of 35% applicable to the Company’s current fiscal year prior to the Effective Date and the post-enactment U.S. federal statutory tax rate of 21% applicable from January 1 to January 28 of 2018. The U.S. federal statutory rate is 21% for fiscal years beginning after January 28, 2018. As a result of the Tax Act in fiscal 2017, the Company recorded a net benefit of $1.5 million from remeasuring its deferred tax assets and liabilities for the year ended January 28, 2018.

The Company had a research and development tax credit study performed for fiscal 2016, 2017 and 2018. The Company filed an amended tax return for fiscal 2016 and fiscal 2017 reflecting research and development tax credits of $0.1 million and $0.2 million, respectively. The Company recognized a $0.4 million research and development tax credit for fiscal 2018. The above credits were recognized as a discrete item in the fourth quarter of fiscal 2019.

The reconciliation of income tax expense to the amount computed at the federal statutory rate was as follows:


	Fiscal Year Ended

	February 2, 2020				February 3, 2019				January 28, 2018
(in thousands)
Federal taxes at statutory rate	$	5,114	21.0	%	$	6,637	21.0	%	$	11,939	33.9	%
Statutory rate change		—	—	%		—	—	%		(1,510)	(4.3)	%
State and local income taxes, net of federal benefit		965	4.0	%		1,679	5.3	%		1,410	4.0	%
Research and development tax credits		(487)	(2.0)	%		—	—	%		—	—	%
Other		(163)	(0.7)	%		134	0.4	%		39	0.1	%
Total income tax expense	$	5,429	22.3	%	$	8,450	26.7	%	$	11,878	33.7	%

Deferred income taxes reflect the net tax effects of temporary differences between U.S. GAAP and tax bases of assets and liabilities. Significant components of deferred tax assets and liabilities were as follows:



	February 2, 2020		February 3, 2019
(in thousands)
Deferred tax assets:
Returns allowance	$	912	$	543
Uniform capitalization		2,930		1,020
Inventory		(27)		661
Deferred rent		—		1,380
Accruals		388		6,337
Stock-based compensation		352		343
Advance payments		820		494
Capital lease		—		81
Net operating loss carryover		—		325
Federal credit carryover		—		17
Total deferred tax assets		5,375		11,201

Deferred tax liabilities:
Property and equipment		10,346		19,739
Unrealized gain on investment		66		—
Prepaid expenses		857		1,120
Goodwill and intangibles		66		64
Capital lease		2,358		—
Revenue recognition method adjustment		187		—
Total deferred tax liabilities		13,880		20,923
Net deferred tax liabilities	$	8,505	$	9,722

Uncertain Tax Positions

As of February 2, 2020 and February 3, 2019, there were no material unrecognized tax benefits. The Company does not anticipate that there will be a material change in the balance of the unrecognized tax benefits in the next 12 months. Any interest and penalties related to uncertain tax positions are recorded in income tax expense. There were no amounts recorded as tax expense for interest or penalties for the years ended February 2, 2020, February 3, 2019 and January 28, 2018.

The Company files income tax returns in the United States federal jurisdiction and in various state jurisdictions. Federal tax returns for tax years beginning January 1, 2016, and state tax returns for tax years beginning January 1, 2015, are open for examination.