Income Taxes

12 Months Ended

Jan. 30, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Note 9 – Income Taxes

The provision for income taxes consisted of:

(In thousands)	2020			2019			2018
Current:
Federal	$	2,233		$	6,799		$	11,468
State		887			2,175			1,693
Puerto Rico		241			241			700
Total current		3,361			9,215			13,861
Deferred:
Federal		2,122			2,749			(894	)
State		(294	)		3			(745	)
Puerto Rico		133			246			643
Total deferred		1,961			2,998			(996	)
Valuation allowance		237			(379	)		(643	)
Total provision	$	5,559		$	11,834		$	12,222

Reconciliation between the statutory federal income tax rate and the effective income tax rate is as follows:

Fiscal years	2020			2019			2018
U.S. Federal statutory tax rate		21.0	%		21.0	%		21.0	%
State and local income taxes, net of federal tax    benefit		2.4			3.2			3.0
Puerto Rico		1.7			0.5			4.2
Valuation allowance		0			(0.7	)		(1.3	)
Tax effect of foreign losses		0			0.4			(2.7	)
Excess tax benefit on stock-based compensation		0.4			(3.6	)		0.0
Other		0.3			0.8			0.1
Effective income tax rate		25.8	%		21.6	%		24.3	%

Deferred income taxes are the result of temporary differences in the recognition of revenue and expense for tax and financial reporting purposes.  The sources of these differences and the tax effect of each are as follows:

(In thousands)	January 30, 2021			February 1, 2020
Deferred tax assets:
Lease obligations	$	56,287		$	57,891
Accrued compensation		4,957			4,844
Inventory		32			938
Other		1,886			1,282
Total deferred tax assets		63,162			64,955
Valuation allowance		(431	)		(194	)
Total deferred tax assets – net of valuation    allowance		62,731			64,761
Deferred tax liabilities:
Lease right-of-use assets		50,609			51,367
Property and equipment		5,064			4,711
Other		1,423			850
Total deferred tax liabilities		57,096			56,928
Long-term deferred income taxes, net	$	5,635		$	7,833

We have tax credit carryforwards associated with our Puerto Rico operations totaling $431,000 at January 30, 2021 and $194,000 at February 1, 2020.  These credits expire at various times over the next ten years.  We have taken a full valuation allowance against these credits given they are not expected to be utilized due to the current differential between U.S. and Puerto Rico tax rates.

As of January 30, 2021 and February 1, 2020, there were no unrecognized tax liabilities or related accrued penalties or interest in other liabilities on the consolidated balance sheets.