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INCOME TAXES
 12 Months Ended
Oct. 03, 2020
Income Tax Disclosure [Abstract]  
INCOME TAXES

NOTE 11. INCOME TAXES

 

The components of our provision for income taxes for our fiscal years 2020 and 2019 are as follows:

 

   2020   2019 
Current:        
     Federal  $(70,000)  $261,000 
     State   113,000    263,000 
 Deferred:   43,000    524,000 
     Federal   (88,000)   301,000 
     State   (15,000)   62,000 
    (103,000)   363,000 
   $(60,000)  $887,000 

 

A reconciliation of income tax computed at the statutory federal rate to income tax expense is as follows:

 

   2020   2019 
         
  Tax provision at the statutory rate  $446,000   $1,315,000 
  Non-controlling interests   (226,000)   (363,000)
  State income taxes, net of federal income tax   43,000    231,000 
  FICA tip credit   (418,000)   (463,000)
  True up adjustment   43,000    71,000 
  Tax effect of rate change due to Tax Reform   13,000    51,000 
  Other permanent items   39,000    45,000 
   $(60,000)  $887,000 

 

We have deferred tax assets which arise primarily due to depreciation recorded at different rates for tax and book purposes offset by cost basis differences in depreciable assets due to the deferral of the recognition of insurance recoveries on casualty losses for tax purposes, investments in and management fees paid by limited partnerships, accruals for potential uninsured claims, bonuses accrued for book purposes but not paid within two and a half months for tax purposes, the capitalization of certain inventory costs for tax purposes not recognized for financial reporting purposes, the recognition of revenue from gift cards not redeemed within twelve months of issuance, allowances for uncollectable receivables, unfunded limited retirement commitments and tax credit carryforwards generated as a result of the application of alternative minimum taxes.

 

The components of our deferred tax assets at October 3, 2020 and September 28, 2019 were as follows:

 

   2020   2019 
Long-Term:          
   Reversal of aged payables  $18,000   $19,000 
   Capitalized inventory costs   22,000    20,000 
   Accrued bonuses   166,000    251,000 
   Accruals for potential uninsured claims   27,000   23,000 
   Gift cards   162,000    143,000 
   Limited partnership management fees   (192,000)   (325,000)
   Tip credit   7,000    — 
   Book/tax differences in property and equipment  (507,000)  (205,000)
   Book/tax differences in operating leases   279,000    — 
   Limited partnership investments   307,000    254,000 
   Accrued limited retirement   63,000    69,000 
Total Deferred Tax Assets  $352,000   $249,000