8. INCOME TAXES

The provision for income taxes consists of the following:

	Year ended December 31,

	2016			2015		2014
Current taxes:
Federal	$	8,571,034			4,428,344	$	1,939,830
State		98,881			49,185		17,872
Total current taxes		8,669,915			4,477,529		1,957,702
Deferred taxes:
Federal		(2,647,363	)		452,761		425,127
State		(19,787	)		3,038		3,878
Total deferred taxes		(2,667,150	)		455,799		429,005
Total provision for income taxes	$	6,002,765			4,933,328	$	2,386,707

The effective income tax rate of the Company differs from the federal statutory tax rate due to the following items:

	Year ended December 31,

	2016			2015			2014
Statutory rate		35.00	%		34.00	%		34.00	%
State income taxes, net of federal income tax benefit		0.26	%		0.25	%		0.17	%
Stock-based compensation		(0.50	)%		(0.46	)%		(0.40	)%
Miscellaneous other, net		(0.21	)%		0.11	%		0.17	%
Effective tax rate		34.55	%		33.90	%		33.94	%

The effective rate reconciliation includes the permanent differences and changes for windfalls and stock-based compensation, and net operating loss.

Deferred income taxes reflect the tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The components of deferred income tax assets and liabilities are as follows:

	December 31,

	2016		2015
Deferred revenue	$	2,643,678	$	33,823
Stock option based compensation		536,065		490,405
Other		110,379		98,744
Net deferred tax asset	$	3,290,122	$	622,972

Stock option based compensation, recorded in the Company's consolidated financial statements, is non-deductible for tax purposes and increases the Company's effective tax rate. Deferred tax assets, including those associated with stock option based compensation, are reviewed and adjusted for apportionment and potential tax rates changes in various jurisdictions.

During 2016, the Company has recorded $0.3 million of excess tax benefits resulting from the exercise of stock options which was recorded in additional paid in capital.

As of December 31, 2016, the Company believes that there are no significant uncertain tax positions, and no amounts have been recorded for interest and penalties. The tax periods open to examination by the major taxing jurisdictions to which the Company is subject include fiscal years 2013 through 2016.