INCOME TAXES (Tables)

12 Months Ended

Sep. 30, 2018

Schedule of Components of Income Tax Expense (Benefit)

rovision for income taxes during the years ended September 30, 2018 and 2017 follows:



	Years Ended
Income Tax Provision	September 30, 2018			September 30, 2017
(in thousands)
Current tax:
State	$	6		$	53
Federal	12			9

Deferred tax:
State	(103		)	—
Federal	5,088			—
Valuation allowance	(13,840		)	—
(Benefit)/provision for income taxes	$	(8,837	)	$	62

Schedule of Effective Income Tax Rate Reconciliation

Differences between the federal statutory rate and IEC’s effective tax rates for fiscal 2018 and fiscal 2017 are explained by the following reconciliation.



	Years Ended
Taxes as Percent of Pretax Income	September 30, 2018		September 30, 2017

Federal statutory rate	24.2	%	34.0	%

Decrease in valuation allowance	(880.0	)	(164.4	)
Deferred tax adjustment	(21.2	)	65.8
Decrease in state deferred tax rate	(6.6	)	—
State income taxes, net of federal benefit	0.4		26.8
Rate change due to Tax Reform	316.6		—
Stock-based compensation	7.3		57.6
Non-deductible expenses	0.6		23.5
Other	(3.2	)	—

Income tax provision as percent of pretax income	(561.9	)%	43.3	%

Schedule of Deferred Tax Assets by Category

The following table displays deferred tax assets by category:



	As of
	September 30, 2018			September 30, 2017
(in thousands)
Deferred tax assets:
Federal and state net operating loss carryforward	$	6,366		$	11,367
Alternative minimum tax credit carryforward	1,031			1,010
Depreciation and fixed assets	306			289
Amortization and impairment of intangibles	27			28
New York State investment tax and other credits	1,308			1,186
Inventories	382			585
Deferred gain on sale-leaseback	431			271
Other	312			412
Total before allowance	10,163			15,148
Valuation allowance	(1,308		)	(15,148		)
Deferred tax assets, net	$	8,855		$	—