Note 5 - Income Taxes

12 Months Ended

Mar. 31, 2018

Notes to Financial Statements

Income Tax Disclosure [Text Block]

( 5 ) Income Taxes

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities are as follows (in thousands):

	March 31,
	2018			2017
Deferred tax assets:
Accrued expenses	$	346		$	474
Deferred stock compensation		353			334
Bad debt and inventory reserves		22			29
Total deferred tax assets		721			837
Deferred tax liabilities:
Property and equipment		1,717			1,925
Total net deferred taxes	$	(996	)	$	(1,088	)

At

March 31, 2018,

the Company had

no

federal net operating loss carryforwards.

The components of the income tax provision consist of the following (in thousands):

	Year Ended March 31,
	2018			2017		2016
Current taxes
Federal	$	15,012		$	11,095	$	10,982
State		1,586			1,059		1,041
Total current taxes		16,598			12,154		12,023
Deferred taxes
Federal		(83	)		1,781		(21	)
State		(9	)		170		(2	)
Total deferred taxes		(92	)		1,951		(23	)
Total provision for income taxes	$	16,506		$	14,105	$	12,000

The reconciliation of income tax provision computed at the U.S. federal statutory tax rates to income tax expense is as follows (in thousands):

	Year Ended March 31,
	2018			2017			2016
Income taxes at U.S. statutory rates	$	16,943		$	13,274		$	11,399
State income taxes, net of federal tax benefit		1,078			858			675
Restricted stock windfall adjustment		(1,086	)
Reduction of deferred tax liability due to rate reduction					(430	)
Permanent differences		1			1			(23	)
Other		-			(28	)		(51	)
Total provision for income taxes	$	16,506		$	14,105		$	12,000

The

2017

Tax Cuts and Jobs Act (the

“2017

Tax Act”) was signed into law on

December 22, 2017.  

The

2017

Tax Act made a significant number of changes to the existing U.S. Internal Revenue Code, including a permanent reduction of the U.S. corporate income tax rate from

35%

to

21%

for tax years beginning after

December 31, 2017.

In accordance with SEC Staff Bulletin

No.

118,

fiscal year end companies were required to determine the appropriate blended rate to apply based on their respective fiscal year end dates. Therefore, instead of applying a

35.0%

federal tax rate for the fiscal year ended

March 31, 2018,

the Company applied a blended federal rate of

31.5%.

This blended rate was applied to fiscal

2018,

resulting in a tax benefit of approximately

$1.9

million. As a result, the Company recorded a provisional income tax benefit of

$430,000

related to the re-measurement of deferred tax assets and liabilities resulting from the reduction of the federal corporate tax rate.  The Company also recognized a stock compensation windfall benefit of

$1.1

million, and recognized a

one

-time net benefit of

$150,000

related to a return to provision true up of the fiscal

2017

income tax provision.