10. INCOME TAXES

The components of income tax expense for fiscal 2012, 2011 and 2010, are as follows:



	2012		2011		2010
Federal:
Current	$	7,156	$	5,406	$	10,365
Deferred	630		1,215		(976		)
State and local:
Current	1,174		491		915
Deferred	114		136		(108		)
Total	$	9,074	$	7,248	$	10,196

Income tax expense differs from a calculated income tax at the Federal statutory rate as follows:



	2012			2011			2010
Computed Federal income tax expense at the statutory rate of 35%	$	7,980		$	6,962		$	10,025
State income tax expense	859			627			807
Non-deductible acquisition related costs	698			—			—
Other	(463		)	(341		)	(636		)
Total	$	9,074		$	7,248		$	10,196

Net cash income tax payments amounted to $5,213, $4,266 and $9,655, respectively, for fiscal 2012, 2011 and 2010.

Deferred income taxes, net, consist of the following at May 31:



	2012						2011
	Current			Long-Term			Current			Long-Term
Assets:
Accounts receivable allowances	$	1,184		$	—		$	530		$	—
Inventories adjustment	1,292			—			1,029			—
Long-term incentive awards	—			1,708			—			1,863
Acquisition costs	—			—			—			499
Accrued vacation, bonuses, dividends and other	1,273			151			1,865			343
Total	3,749			1,859			3,424			2,705
Liabilities:
Basis differences in fixed and intangible assets	—			(47,211		)	—			(4,088		)
Prepaid insurance	(146		)	—			(137		)	—
Other	(323		)	—			(215		)	—
Total	(469		)	(47,211		)	(352		)	(4,088		)
Deferred income taxes, net	$	3,280		$	(45,352	)	$	3,072		$	(1,383	)

At May 31, 2012, we have no net operating loss, capital loss or tax credit carryforwards. No valuation allowance is required since we believe that it is more likely than not that existing deferred tax assets will be realized. The amount of the deferred tax assets considered realizable, could be reduced or increased in the near-term if facts, including the amount of taxable income, differs from our estimates.

A reconciliation of the beginning and ending amount of unrecognized tax benefits (excluding interest and penalties) is as follows:



Balance at June 1, 2009	$	196
Additions based on tax positions related to the current year	121
Additions based on tax positions related to prior years	38
Reductions for tax positions of prior years	(26		)
Balance at May 31, 2010	329
Additions based on tax positions related to the current year	106
Additions based on tax positions related to prior years	89
Reductions for tax positions of prior years	(27		)
Balance at May 31, 2011	497
Additions based on tax positions related to the current year	116
Additions based on tax positions related to prior years	—
Reductions for tax positions of prior years	(161		)
Balance at May 31, 2012	$	452

Unrecognized tax benefits decreased during fiscal 2012 and 2011 as follows:



	2012		2011
Timing differences related to the expiration of statute of limitations:
Related to the amortization of certain intangible assets	$	27	$	27
Related to the recognition of inventory obsolescence	11		—
Permanent differences related to the expiration of statute of limitations:
Related to certain federal tax deductions/credits	43		—
Related to certain state tax credits	6		—
Permanent differences related to the successful appeal for certain state tax credits	74		—
	$	161	$	27

Of the $452 total unrecognized tax benefits at May 31, 2012, $424 would affect the effective income tax rate, if recognized. We recognize interest and penalties accrued related to unrecognized tax benefits in income tax expense. During fiscal 2012 and fiscal 2011, respectively, we recognized an increase (decrease) of $(1) and $12 in interest and penalties. At May 31, 2012 and 2011, respectively, we had $22 and $23 in accrued interest and penalties. The total unrecognized tax benefit accrued (including interest and penalties) was $474 and $520, respectively, at May 31, 2012 and 2011. We do not anticipate that unrecognized tax benefits will significantly increase or decrease within 12 months of the reporting date. We file income tax returns in the U.S. federal jurisdiction, and in various state and local jurisdictions. We are no longer subject to U.S. federal income tax examinations for years prior to fiscal 2009, and we are no longer subject to state and local income tax examinations for years prior to fiscal 2008.