8. INCOME TAXES

The provision for income taxes is comprised of the following:



	For the Fiscal Years Ended
	August 31, 2013			September 1, 2012		August 27, 2011
Current:
Federal	$	119,470		$	128,640	$	99,034
State and local		18,629			18,421		15,986
		138,099			147,061		115,020
Deferred:
Federal		7,403			4,797		15,385
State and local		(68	)		1,253		139
		7,335			6,050		15,524
Total	$	145,434		$	153,111	$	130,544

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



	August 31, 2013			September 1, 2012
Deferred tax liabilities:
Depreciation	$	(46,339	)	$	(41,812	)
Deferred catalog costs		(1,730	)		(1,779	)
Goodwill		(44,751	)		(35,841	)
		(92,820	)		(79,432	)
Deferred tax assets:
Accounts receivable		2,254			2,030
Inventory		7,345			5,703
Deferred compensation		1,509			1,272
Stock based compensation		10,888			9,981
Intangible amortization		9,983			7,027
Other		5,792			5,705
		37,771			31,718
Net Deferred Tax Liabilities	$	(55,049	)	$	(47,714	)

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



	For the Fiscal Years Ended
	August 31, 2013			September 1, 2012			August 27, 2011
U.S. Federal statutory rate		35.0	%		35.0	%		35.0	%
State income taxes, net of Federal benefit		3.0			2.7			2.8
Other, net		(0.1	)		(0.5	)		(0.4	)
Effective income tax rate		37.9	%		37.2	%		37.4	%

The aggregate changes in the balance of gross unrecognized tax benefits during fiscal 2013 and 2012 were as follows:



	August 31, 2013			September 1, 2012
Beginning Balance	$	7,811		$	11,393
Additions for tax positions relating to current year		2,516			2,294
Additions for tax positions relating to prior years		—			74
Reductions for tax positions relating to prior years		(936	)		(1,540	)
Settlements		(120	)		(1,144	)
Lapse of statute of limitations		(1,079	)		(3,266	)
Ending Balance	$	8,192		$	7,811

Included in the balance of unrecognized tax benefits at August 31, 2013 is $976 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 in state jurisdictions.

The Company recognizes interest expense and penalties in the provision for income taxes. The fiscal 2013 and 2012 provisions include interest and penalties of $92 and $79 respectively. The Company has accrued $159 and $253 for interest and penalties as of August 31, 2013 and September 1, 2012, respectively.

With limited exceptions, the Company is no longer subject to Federal income tax examinations and state jurisdictions through fiscal 2009.