14. Income Taxes

Significant components of the Company's net deferred tax liability consisted of the following at:

	July 29, 2011		July 30, 2010
Deferred tax assets:
Financial accruals without economic performance	$	56,954	$	60,687
Other		15,068		9,821
Deferred tax assets	$	72,022	$	70,508

Deferred tax liabilities
Excess tax depreciation over book	$	90,361	$	79,503
Other		28,033		25,719
Deferred tax liabilities		118,394		105,222
Net deferred tax liability	$	46,372	$	34,714

The Company provided no valuation allowance against deferred tax assets recorded as of July 29, 2011 and July 30, 2010, as the “more-likely-than-not” valuation method determined all deferred assets to be fully realizable in future taxable periods.

The components of the provision for income taxes from continuing operations for each of the three years were as follows:

	2011			2010			2009
Current:
Federal	$	17,231		$	29,114		$	20,307
State		5,577			(88	)		3,320
Deferred:
Federal		9,019			336			(1,157	)
State		(1,344	)		1,089			1,635
Total income tax provision	$	30,483		$	30,451		$	24,105

A reconciliation of the provision for income taxes from continuing operations and the amount computed by multiplying the income before the provision for income taxes by the U.S. federal statutory rate of 35% was as follows:

	2011			2010			2009
Provision computed at federal statutory income tax rate	$	40,492		$	40,498		$	31,521
State and local income taxes, net of federal benefit		3,050			495			1,697
Employer tax credits for FICA taxes paid on employee tip income		(8,351	)		(8,062	)		(6,383	)
Other employer tax credits		(5,098	)		(3,769	)		(3,740	)
Other-net		390			1,289			1,010
Total income tax provision	$	30,483		$	30,451		$	24,105

As of July 29, 2011 and July 30, 2010, the Company's liability for uncertain tax positions was $19,547 ($13,223, net of related federal tax benefits of $6,324) and $17,467 ($11,791, net of related federal tax benefits of $5,676), respectively. At July 29, 2011, July 30, 2010 and July 31, 2009, the amount of uncertain tax positions that, if recognized, would affect the effective tax rate is $13,223, $11,791 and $17,364, respectively.

Summarized below is a tabular reconciliation of the beginning and ending balance of the Company's total gross liability for uncertain tax positions exclusive of interest and penalties:

	July 29, 2011			July 30, 2010			July 31, 2009
Balance at beginning of year	$	12,965		$	21,956		$	22,879
Tax positions related to the current year:
Additions		2,616			2,195			3,168
Reductions		--			--			--
Tax positions related to prior years:
Additions		987			44			90
Reductions		(24	)		(4,458	)		(2,146	)
Settlements		--			(4,980	)		(127	)
Expiration of statute of limitations		(2,377	)		(1,792	)		(1,908	)
Balance at end of year	$	14,167		$	12,965		$	21,956

At July 29, 2011, July 30, 2010 and July 31, 2009, the Company recognized approximately $651, $271 and $302, respectively, in interest and penalties related to uncertain tax positions in its provision for income taxes. At July 29, 2011, and July 30, 2010, the Company's liability for uncertain tax positions included $4,014 and $3,363, respectively, net of tax for potential interest and penalties.

In many cases, the Company's uncertain tax positions are related to tax years that remain subject to examination by the relevant taxing authorities. Based on the outcome of these examinations or as a result of the expiration of the statutes of limitations for specific taxing jurisdictions, the related uncertain tax positions taken regarding previously filed tax returns could decrease from those recorded as liabilities for uncertain tax positions in the Company's financial statements at July 29, 2011 by approximately $3,000 to $5,000 within the next twelve months. At July 29, 2011, the Company was subject to income tax examinations for its U.S. federal income taxes after 2007 and for state and local income taxes generally after 2007.