Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

Components of Provision for Income Taxes

We file consolidated federal income tax returns that include all of our subsidiaries. The components of the provision for income taxes from continuing operations for the years ended December 31, 2014, 2013, and 2012 are as follows (in thousands):

	2014		2013			2012
Current
Federal	$	7,889	$	12,654		$	14,782
State		1,486		2,544			2,959
		9,375		15,198			17,741
Deferred
Federal		2,595		(848	)		(999	)
State		488		(26	)		(254	)
		3,083		(874	)		(1,253	)
Provision for income taxes	$	12,458	$	14,324		$	16,488

Effective Income Tax Reconciliation

The differences between the amount of tax computed at the federal statutory rate of 35% and the provision for income taxes from continuing operations for the years ended December 31, are as follows (in thousands):

	2014			2013			2012
Tax at statutory federal income tax rate	$	11,531		$	13,410		$	15,348
Increases (decreases) in tax resulting from:
State taxes, net of federal tax benefit		1,486			1,630			1,901
Permanent differences, net		(516	)		(685	)		(522	)
Other, net		(43	)		(31	)		(239	)
Provision for income taxes	$	12,458		$	14,324		$	16,488

Deferred Tax Assets and Liabilities

The tax effect of temporary differences representing deferred tax assets and liabilities as of December 31, 2014 and 2013, are as follows (in thousands):

	2014			2013
Gross deferred tax assets
Deferred compensation and accrued paid leave	$	6,992		$	6,805
Accrued expenses		1,276			1,489
Stock-based compensation		592			510
Interest rate swaps		-			125
Reserve for contract disallowances		287			326
Acquisition-related expenses		982			603
Capitalized inventory		589			409
Other		5			-
Total gross deferred tax assets		10,723			10,267

Gross deferred tax liabilities
Depreciation		(2,830	)		(3,237	)
Deferred revenues		(2,676	)		(1,921	)
Goodwill and intangible assets		(5,017	)		(1,701	)
Total gross deferred tax liabilities		(10,523	)		(6,859	)

Net deferred tax assets	$	200		$	3,408