Income Taxes

12 Months Ended

Dec. 31, 2020

Income Taxes

5- Income taxes

(5) Income Taxes

The items comprising Provision for Income Taxes are as follows (in thousands):

	Year ended December 31,
	2020		2019		2018
Current — Federal	$	3,166	$	3,508	$	6,405
— State		904		1,090		2,001
		4,070		4,598		8,406
Deferred — Federal		2,111		1,660		(626	)
— State		171		149		1
		2,282		1,809		(625	)
Provision for Income Taxes	$	6,352	$	6,407	$	7,781

Temporary differences and carryforwards which have given rise to deferred tax liabilities as of December 31, 2020 and 2019 are as follows (in thousands):

	2020			2019
Deferred tax liabilities (assets):
Property, plant and equipment	$	11,532		$	9,697
Patents and goodwill		1,775			1,756
Benefit plans		(1,976	)		(2,131	)
Inventories		(420	)		(350	)
Capital loss carryover		(544	)		(556	)
Other		(179	)		(513	)
		10,188			7,903
Plus: Valuation allowance		580			593
Total deferred tax liabilities	$	10,768		$	8,496

Total income tax expense differs from the amount that would be provided by applying the statutory federal income tax rate to pretax earnings as illustrated below (in thousands): 

	Year ended December 31,
	2020			2019			2018
Income tax expense at the statutory federal income tax rate	$	8,078		$	9,065		$	8,828
Increase (decrease) resulting from:
State income taxes		838			978			1,572
R&D tax credits		(1,589	)		(1,470	)		(1,212	)
Foreign-derived intangible income deduction		(1,051	)		(1,700	)		(1,000	)
Excess tax benefit from stock compensation		(81	)		(412	)		(95	)
Change in valuation allowance		(13	)		(16	)		-
Uncertain tax positions		(450	)		(42	)		(373	)
Other, net		619			4			61
Provision for Income Taxes	$	6,352		$	6,407		$	7,781

A reconciliation of the beginning and ending balances of the total amounts of gross unrecognized tax benefits as required by ASC 740 is as follows (in thousands):

Gross unrecognized tax benefits at January 1, 2018	$	865
Increase in tax positions for prior years		25
Increase in tax positions for current years		—
Lapse in statutes of limitation		(397	)
Gross unrecognized tax benefits at December 31, 2018	$	493
Increase in tax positions for prior years		19
Increase in tax positions for current year		—
Lapse in statutes of limitation		(62	)
Gross unrecognized tax benefits at December 31, 2019	$	450
Increase in tax positions for prior years		8
Increase in tax positions for current year		—
Lapse in statutes of limitation		(458	)
Gross unrecognized tax benefits at December 31, 2020	$	—

We are subject to United States federal income tax as well as to income tax of multiple state jurisdictions. We have concluded all United States federal income tax matters, as well as all material state and local income tax matters, for years through 2016.

We recognize interest and penalties, if any, related to unrecognized tax benefits in income tax expense. The liability for unrecognized tax benefits included accrued interest of $20,000 and $19,000 at December 31, 2019 and 2018, respectively. Tax expense for the years ended December 31, 2020, 2019 and 2018 included a net interest benefit of $35,000, $16,000 and $18,000, respectively.