9.	Income Taxes

The components of the income tax provision (benefit) are as follows:


(in thousands)	2015			2014			2013
Current:
Federal	$	55,140		$	48,293		$	42,458
State		3,578			2,882			3,105

		58,718			51,175			45,563

Deferred:
Federal		(4,874	)		(597	)		249
State		(232	)		(35	)		18

		(5,106	)		(632	)		267

Total	$	53,612		$	50,543		$	45,830

The following is a reconciliation of income taxes at the statutory tax rate to the Company’s effective tax rate:


	2015			2014			2013
Federal taxes at statutory rate		35.0	%		35.0	%		35.0	%
State taxes, net of federal tax benefit		1.8			1.2			1.6
Research and development tax credit		(0.2	)		(0.4	)		(0.7	)
Other		0.1			0.2			—

Effective tax rate		36.7	%		36.0	%		35.9	%

At December 26, 2015, we had $1.9 million of unrecognized tax benefits, $1.3 million of which would affect our effective tax rate if recognized.

The following table summarizes the change in uncertain tax benefits for the three years ended December 26, 2015:


(in thousands)	2015			2014			2013
Balance at beginning of year	$	1,163		$	1,201		$	1,785
Reductions due to lapses in statutes of limitations		—			(301	)		(30	)
Reductions due to tax positions settled		(177	)		—			(271	)
Reductions due to reversals of prior year positions		(20	)		(38	)		(736	)
Additions based on tax positions taken during the current period		889			301			453

Balance at end of year	$	1,855		$	1,163		$	1,201

We recognize interest and penalties related to uncertain tax positions in income tax expense. As of December 26, 2015, we had approximately $0.2 million of accrued interest related to uncertain tax positions.

Deferred income taxes result from timing differences in the recognition of revenue and expense for tax and financial statement purposes. The sources of temporary differences are as follows:


(in thousands)	December 26, 2015		December 27, 2014
Assets:
Inventories	$	8,685	$	7,989
Accounts receivable		18,954		15,652
Accrued expenses		2,435		1,780
Other		214		197

Gross deferred tax assets		30,288		25,618

Liabilities:
Depreciation		13,207		13,406
Goodwill and intangible assets		9,524		9,761

Gross deferred tax liabilities		22,731		23,167

Net deferred tax assets	$	7,557	$	2,451

Based on our history of taxable income and our projection of future earnings, we believe that it is more likely than not that sufficient taxable income will be generated in the foreseeable future to realize the remaining net deferred tax assets.

We file income tax returns in the United States, China and Mexico. All years before 2012 are closed for federal tax purposes. The examination by the Internal Revenue Service for the 2011 and 2012 tax years resulted in de minimis adjustments. We are currently under examination by one state tax authority for years 2009-2012. Tax years before 2011 are closed for the remaining states in which we file. We filed tax returns in Sweden through 2012 and all years prior to 2009 are closed. It is reasonably possible that audit settlements, the conclusion of current examinations or the expiration of the statute of limitations could impact the Company’s unrecognized tax benefits.