Income Taxes

The components of the provision (benefit) for income taxes were as follows (dollars in thousands):



	Fiscal Year Ended			Six Months Ended			Fiscal Year Ended
	January 26, 2019			January 27, 2018			July 29, 2017			July 30, 2016
Current:
Federal	$	9,507		$	(4,384	)	$	62,455		$	42,096
Foreign	2,204			598			176			310
State	4,897			1,166			12,344			8,399
	16,608			(2,620		)	74,975			50,805
Deferred:
Federal	8,706			(21,332		)	17,051			26,467
Foreign	(446		)	(37		)	(35		)	(296		)
State	263			1,704			1,217			611
	8,523			(19,665		)	18,233			26,782
Total provision (benefit) for income taxes	$	25,131		$	(22,285	)	$	93,208		$	77,587

The Tax Cuts and Jobs Act of 2017 (“Tax Reform”) was enacted in December 2017 and includes significant changes to U.S. income tax law. Tax Reform, among other things, reduced the U.S. federal corporate tax rate from 35 percent to 21 percent.

The Company’s effective income tax rate differs from the statutory rate for the tax jurisdictions where it operates primarily as the result of the impact of non-deductible and non-taxable items, tax credits recognized in relation to pre-tax results, certain tax impacts from the vesting and exercise of share-based awards, and impacts from Tax Reform. The Company was subject to a blended statutory tax rate of approximately 33% for the six months ended January 27, 2018 resulting from Tax Reform taking effect for a portion of the period based on the Company’s fiscal year end. A reconciliation of the amount computed by applying the Company’s statutory income tax rate to pre-tax income to the total tax provision is as follows (dollars in thousands):



	Fiscal Year Ended			Six Months Ended			Fiscal Year Ended
	January 26, 2019			January 27, 2018			July 29, 2017			July 30, 2016
Statutory rate applied to pre-tax income	$	18,488		$	15,334		$	87,649		$	72,214
State taxes, net of federal tax benefit	4,004			1,406			9,868			7,398
Tax Reform and related effects	—			(32,249		)	—			—
Federal benefit of vesting and exercise of share-based awards	(200		)	(7,067		)	—			—
Non-deductible and non-taxable items, net	2,433			1,585			(4,686		)	(2,013		)
Change in accruals for uncertain tax positions	464			250			632			113
Tax credits	(1,835		)	(1,596		)	—			—
Change in valuation allowance	291			—			—			—
Effect of rates other than statutory	1,537			557			6			118
Other items, net	(51		)	(505		)	(261		)	(243		)
Total provision (benefit) for income taxes	$	25,131		$	(22,285	)	$	93,208		$	77,587

During the six months ended January 27, 2018, the Company recognized an income tax benefit of approximately $32.2 million primarily resulting from the re-measurement of the Company’s net deferred tax liabilities to reflect the reduced rate under Tax Reform. Additionally, the Company recognized an income tax benefit (including federal and state tax benefits) of approximately $7.8 million during the six months ended January 27, 2018 for certain tax effects of the vesting and exercise of share-based awards.

During fiscal 2017 and 2016, non-taxable and non-deductible items consisted of a production related tax deduction of $6.0 million and $4.5 million, respectively, offset by $1.3 million and $2.5 million of non-deductible items, respectively. There was no production related tax deduction for the six months ended January 27, 2018. Additionally, beginning in fiscal 2019, the production related tax deduction is no longer permitted as a result of changes from Tax Reform.

During fiscal 2017 and 2016, tax credits of $1.0 million and $0.7 million, respectively, were presented within Non-deductible and non-taxable items, net in the table above.

Deferred Income Taxes

The deferred tax provision represents the change in the deferred tax assets and the liabilities representing the tax consequences of changes in the amount of temporary differences and changes in tax rates during the year. The significant components of deferred tax assets and liabilities consisted of the following (dollars in thousands):



	January 26, 2019			January 27, 2018
Deferred tax assets:
Insurance and other reserves	$	22,885		$	22,368
Allowance for doubtful accounts and reserves	5,323			1,081
Net operating loss carryforwards	5,515			822
Stock-based compensation	3,324			3,405
Other	3,764			1,174
Total deferred tax assets	40,811			28,850
Valuation allowance	(418		)	(148		)
Deferred tax assets, net of valuation allowance	$	40,393		$	28,702
Deferred tax liabilities:
Property and equipment	$	77,490		$	59,933
Goodwill and intangibles	27,780			25,852
Other	1,086			345
Deferred tax liabilities	$	106,356		$	86,130

Net deferred tax liabilities	$	65,963		$	57,428

The Company’s net deferred tax liabilities as of January 27, 2018 were remeasured to reflect the reduced rate under Tax Reform that will apply in future periods when such assets and liabilities are expected to be settled or realized.

The valuation allowance above reduces the deferred tax asset balances to the amount that the Company has determined is more likely than not to be realized. The valuation allowance primarily relates to immaterial state net operating loss carryforwards and an immaterial foreign tax credit carryforward, which generally begin to expire in fiscal 2023 and fiscal 2022, respectively.

Uncertain Tax Positions

As of January 26, 2019 and January 27, 2018, the Company had total unrecognized tax benefits of $3.8 million and $3.3 million, respectively, resulting from uncertain tax positions. The Company’s effective tax rate will be reduced during future periods if it is determined these unrecognized tax benefits are realizable. The Company had approximately $1.4 million and $1.2 million accrued for the payment of interest and penalties as of January 26, 2019 and January 27, 2018, respectively. Interest expense related to unrecognized tax benefits for the Company was not material during fiscal 2019, the 2018 transition period, or fiscal 2017, or fiscal 2016.

A summary of unrecognized tax benefits is as follows (dollars in thousands):



	Fiscal Year Ended			Six Months Ended			Fiscal Year Ended
	January 26, 2019			January 27, 2018			July 29, 2017			July 30, 2016
Balance at beginning of year	$	3,322		$	3,072		$	2,440		$	2,327
Additions based on tax positions related to the fiscal year	444			283			441			161
Additions (reductions) based on tax positions related to prior years	77			(33		)	229			86
Reductions related to the expiration of statutes of limitation	(57		)	—			(38		)	(134		)
Balance at end of year	$	3,786		$	3,322		$	3,072		$	2,440