INCOME TAXES

12 Months Ended

Jul. 31, 2021

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

The components of the provision for income taxes are:

	2021		2020
Federal:
Current	$	7,172	$	(8,023)
Deferred	(2,037)		10,846
State:
Current	4,229		3,627
Deferred	(505)		344
	$	8,859	$	6,794

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities are as follows:

	July 31, 2021		July 25, 2020
Deferred tax assets:
Lease liabilities	$	106,615	$	98,149
Tax credit carryforward	—		508
Compensation related costs	4,377		2,945
Pension costs	3,248		1,881
Other	552		752
Total deferred tax assets	114,792		104,235
Deferred tax liabilities:
Tax over book depreciation	22,653		23,626
Lease assets	98,994		92,021
Patronage dividend receivable	4,162		3,133
Investment in partnerships	1,162		1,076
Other	611		178
Total deferred tax liabilities	127,582		120,034
Net deferred tax liability	$	(12,790)	$	(15,799)

Deferred income tax assets (liabilities) are included in the following captions on the consolidated balance sheets at July 31, 2021 and July 25, 2020:

	2021	2020
Other assets	1,642	702
Other liabilities	(14,432)	(16,501)

A valuation allowance is provided when it is more likely than not that some portion of the deferred tax assets will not be realized. In management’s opinion, in view of the Company’s previous, current and projected taxable income and reversal of deferred tax liabilities, such tax assets will more likely than not be fully realized. Accordingly, no valuation allowance was deemed to be required at July 31, 2021 and July 25, 2020.

The effective income tax rate differs from the statutory federal income tax rate as follows:

	2021		2020
Statutory federal income tax rate	21.0	%	21.0	%
State income taxes, net of federal tax benefit	10.3	%	9.9	%
Federal net operating loss carryback	—	%	(7.9)	%
Other	(0.6)	%	(1.6)	%
Effective income tax rate	30.7	%	21.4	%

Fiscal 2020 includes a $2,512 incremental benefit from a federal net operating loss carryback at a rate higher than the current statutory tax rate.

The Company is not currently under audit by any tax authorities, but is open to examination with varying statutes of limitations, generally ranging from three to four years.