Sonic 2015 Annual Report Download - page 41

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12. Income Taxes
The Company’s income before the provision for income taxes is classified by source as domestic income.
The components of the provision for income taxes consist of the following for the years ended August 31:
2015 2014 2013
Current:
Federal $ 14,597 $ 16,580 $ 16,741
State 3,576 3,490 2,688
18,173 20,070 19,429
Deferred:
Federal 10,592 5,328 439
State (1,528) 450 (270)
9,064 5,778 169
Provision for income taxes $ 27,237 $ 25,848 $ 19,598
The provision for income taxes differs from the amount computed by applying the statutory federal income tax rate due
to the following for the fiscal years ended August 31:
2015 2014 2013
Amount computed by applying a tax rate of 35% $ 32,103 $ 25,818 $ 19,705
State income taxes (net of federal income tax benefit) 1,330 2,562 1,572
Employment related and other tax credits, net (2,096) (1,537) (1,572)
Federal tax benefit of statutory tax deduction (4,093) – –
Other (7) (995) (107)
Provision for income taxes $ 27,237 $ 25,848 19,598
Deferred tax assets and liabilities consist of the following at August 31:
2015 2014
Deferred tax assets:
Allowance for doubtful accounts and notes receivable $ 411 $ 677
Leasing transactions 3,260 3,252
Deferred income 2,810 1,773
Accrued liabilities 5,630 3,399
Stock compensation 2,831 4,921
Other 541 688
State net operating losses 14,222 11,305
Total deferred tax assets 29,705 26,015
Valuation allowance (12,041) (11,305)
Total deferred tax assets after valuation allowance $ 17,664 $ 14,710
Deferred tax liabilities:
Prepaid expenses $ (1,315) $ (1,498)
Investment in partnerships, including differences in capitalization,
depreciation and direct financing leases (3,711) (2,954)
Property, equipment and capital leases (31,167) (24,655)
Intangibles and other assets (20,341) (19,514)
Debt extinguishment (2,515) (3,353)
Total deferred tax liabilities (59,049) (51,974)
Net deferred tax liabilities $ (41,385) $ (37,264)
Net deferred tax assets and liabilities are classified as follows:
Current $ 2,164 $ 347
Noncurrent (43,549) (37,611)
Total $ (41,385) $ (37,264)
Notes to Consolidated Financial Statements
August 31, 2015, 2014 and 2013 (In thousands, except per share data)
39