6. INCOME TAXES

The provision for income taxes is comprised of the following:



	For the Fiscal Years Ended
	September 3,		August 29,		August 30,
	2016		2015		2014
Current:
Federal	$	109,699	$	109,575	$	115,186
State and local		15,621		17,339		16,528
		125,320		126,914		131,714
Deferred:
Federal		13,993		13,987		10,369
State and local		1,202		932		1,375
		15,195		14,919		11,744
Total	$	140,515	$	141,833	$	143,458

Significant components of deferred tax assets and liabilities are as follows:



	September 3,		August 29,
	2016		2015
Deferred tax liabilities:
Depreciation	$	(53,580)	$	(51,204)
Deferred catalog costs		(1,347)		(1,155)
Goodwill		(88,607)		(73,996)
		(143,534)		(126,355)
Deferred tax assets:
Accounts receivable		4,089		3,807
Inventory		9,995		9,036
Deferred compensation		1,710		2,409
Stock based compensation		9,813		9,831
Intangible amortization		11,933		11,788
Other		9,087		7,772
		46,627		44,643
Net Deferred Tax Liabilities	$	(96,907)	$	(81,712)

Reconciliation of the statutory Federal income tax rate to the Company’s effective tax rate is as follows:



	For the Fiscal Years Ended
	September 3,		August 29,		August 30,
	2016		2015		2014
U.S. Federal statutory rate	35.0	%	35.0	%	35.0	%
State income taxes, net of Federal benefit	3.0		3.1		3.1
Other, net	(0.2)		(0.1)		(0.3)
Effective income tax rate	37.8	%	38.0	%	37.8	%

The aggregate changes in the balance of gross unrecognized tax benefits during fiscal 2016 and 2015 were as follows:



	September 3,		August 29,
	2016		2015
Beginning Balance	$	10,333	$	9,350
Additions for tax positions relating to current year		2,745		2,617
Additions for tax positions relating to prior years		—		104
Settlements		(174)		(41)
Lapse of statute of limitations		(2,294)		(1,697)
Ending Balance	$	10,610	$	10,333

Included in the balance of unrecognized tax benefits at September 3, 2016 is $1,039 related to tax positions for which it is reasonably possible that the total amounts could significantly change during the next twelve months. This amount represents a decrease in unrecognized tax benefits comprised primarily of items related to expiring statutes of limitations in state jurisdictions.

The Company recognizes interest expense and penalties in the provision for income taxes. The fiscal years 2016, 2015 and 2014 provisions include interest and penalties of $6, $19 and $0, respectively. The Company has accrued $235 and $163 for interest and penalties as of September 3, 2016 and August 29, 2015, respectively.

With limited exceptions, the Company is no longer subject to Federal income tax examinations through fiscal 2013 and state income tax examinations through fiscal 2012.