INCOME TAXES

The Company accounts for income taxes using ASC 740, “Income Taxes” which is an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized differently in the financial statements and the tax returns. The provision for income taxes consists of the following at December 31:



($ in thousands)	2015			2014			2013
Total provision:	$	1,125		$	2,697		$	2,086
Federal:
Current	1,521			2,289			(2,459		)
Deferred	(682		)	(313		)	4,097
	839			1,976			1,638
State:
Current	585			603			231
Deferred	(299		)	118			217
	286			721			448
	$	1,125		$	2,697		$	2,086

The reasons for the difference between total income tax expense and the amount computed by applying the statutory Federal income tax rate of 34% to income before taxes are as follows for the years ended December 31:



($ in thousands)	2015			2014			2013
Income tax at statutory rate	$	1,360		$	2,912		$	2,139
State income taxes, net of Federal benefit	213			452			307
Oil and mineral depletion	(213		)	(385		)	(450		)
Permanent differences	(92		)	(172		)	(11		)
Other	(143		)	(110		)	101
Total provision	$	1,125		$	2,697		$	2,086

Deferred income taxes reflect the net 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. Significant components of the Company’s deferred tax assets and liabilities are as follows at December 31:



($ in thousands)	2015		2014
Deferred income tax assets:
Accrued expenses	$	578	$	608
Deferred revenues	652		498
Capitalization of costs	3,023		2,746
Pension adjustment	4,396		4,502
Stock grant expense	3,593		2,936
State deferred taxes	221		200
Book deferred gains	1,711		1,711
Joint venture allocations	860		587
Provision for additional capitalized costs	1,003		1,003
Interest rate swap	1,244		954
Other	3		3
Total deferred income tax assets	$	17,284	$	15,748
Deferred income tax liabilities:
Deferred gains	$	1,390	$	1,390
Depreciation	5,040		4,228
Cost of sales allocations	1,252		1,252
Joint venture allocations	3,121		2,456
Straight line rent	929		947
Prepaid expenses	149		191
State deferred taxes	617		501
Other	127		207
Total deferred income tax liabilities	$	12,625	$	11,172
Net deferred income tax asset	$	4,659	$	4,576
Allowance for deferred tax assets	—		—
Net deferred taxes	$	4,659	$	4,576

Due to the nature of our deferred tax assets, the Company believes they will be used through operations in future years and a valuation allowance is not necessary.

The Company made total federal and state income tax payments of $2,100,000 in 2015 and $1,100,000 during 2014. The Company received refunds of $283,000 and $3,484,000 in 2015 and 2014, respectively.

The Company evaluates its tax positions for all income tax items based on their technical merits to determine whether each position satisfies the “more likely than not to be sustained upon examination” test. The tax benefits are then measured as the largest amount of benefit, determined on a cumulative basis, that is “more likely than not” to be realized upon ultimate settlement. As a result of this evaluation, the Company determined there were no uncertain tax positions that required recognition and measurement for the years ended December 31, 2015 and 2014 within the scope of ASC 740, "Income Taxes." Tax years from 2012 to 2014 and 2011 to 2014 remain available for examination by the Federal and California State taxing authorities, respectively.