7.	Income Taxes

For federal income tax purposes, as well as for state income tax purposes in the majority of the states in which the Partnership operates, the earnings attributable to the Partnership and the Operating Partnership are not subject to income tax at the partnership level. With the exception of those states that impose an entity-level income tax on partnerships, the taxable income or loss attributable to the Partnership and to the Operating Partnership, which may vary substantially from the income (loss) before income taxes reported by the Partnership in the consolidated statement of operations, are includable in the federal and state income tax returns of the Common Unitholders. The aggregate difference in the basis of the Partnership’s net assets for financial and tax reporting purposes cannot be readily determined as the Partnership does not have access to each Common Unitholder’s basis in the Partnership.

As described in Note 1 and Note 2, the earnings of the Corporate Entities are subject to corporate level federal and state income tax. However, based upon past performance, the Corporate Entities are currently reporting an income tax provision composed primarily of minimum state income taxes. A full valuation allowance has been provided against the deferred tax assets based upon an analysis of all available evidence, both negative and positive at the balance sheet date, which, taken as a whole, indicates that it is more likely than not that sufficient future taxable income will not be available to utilize the assets. Management’s periodic reviews include, among other things, the nature and amount of the taxable income and expense items, the expected timing of when assets will be used or liabilities will be required to be reported and the reliability of historical profitability of businesses expected to provide future earnings. Furthermore, management considered tax-planning strategies it could use to increase the likelihood that the deferred tax assets will be realized.

The income tax provision of all the legal entities included in the Partnership’s consolidated statement of operations, which is composed primarily of state income taxes in the few states that impose taxes on partnerships and minimum state income taxes on the Corporate Entities, consists of the following:

	Year Ended
	September 24,		September 26,		September 27,
	2016		2015		2014
Current
Federal	$	7	$	23	$	10
State and local		581		677		757
		588		700		767
Deferred		—		—		—
	$	588	$	700	$	767

The provision for income taxes differs from income taxes computed at the United States federal statutory rate as a result of the following:

	Year Ended
	September 24,			September 26,			September 27,
	2016			2015			2014
Income tax provision at federal statutory tax rate	$	5,260		$	29,768		$	33,346
Impact of Partnership income not subject to federal income taxes		(9,844	)		(32,148	)		(38,919	)
Permanent differences		182			210			86
Change in valuation allowance		4,737			2,181			5,458
State income taxes		(211	)		253			(60	)
Other		464			436			856
Provision for income taxes - current	$	588		$	700		$	767

The components of net deferred taxes and the related valuation allowance using currently enacted tax rates are as follows:

	Year Ended
	September 24,			September 26,
	2016			2015
Deferred tax assets:
Net operating loss carryforwards	$	60,628		$	55,033
Allowance for doubtful accounts		184			340
Inventory		457			395
Deferred revenue		1,091			1,241
Derivative instruments		78			—
AMT credit carryforward		1,086			1,086
Other accruals		1,101			1,718
Total deferred tax assets		64,625			59,813
Deferred tax liabilities:
Derivative instruments		—			142
Intangible assets		775			312
Property, plant and equipment		5,068			5,314
Total deferred tax liabilities		5,843			5,768
Net deferred tax assets		58,782			54,045
Valuation allowance		(58,782	)		(54,045	)
Net deferred tax assets	$	—		$	—