INCOME TAXES

12 Months Ended

Sep. 28, 2019

Income Tax Disclosure [Abstract]

INCOME TAXES

NOTE 11. INCOME TAXES

The components of our provision for income taxes for our fiscal years 2019 and 2018 are as follows:

	2019		2018
Current:
Federal	$	261,000	$	428,000
State		263,000		257,000
Deferred:		524,000		685,000
Federal		301,000		582,000
State		62,000		104,000
		363,000		686,000
	$	887,000	$	1,371,000

A reconciliation of income tax computed at the statutory federal rate to income tax expense is as follows:

	2019			2018
Tax provision at the statutory rate.	$	1,315,000		$	1,588,000
Non-controlling interests		(363,000	)		(402,000	)
State income taxes, net of federal income tax		231,000			248,000
FICA tip credit		(463,000	)		(440,000	)
True up adjustment		71,000			(7,000	)
Tax effect of rate change due to Tax Reform		51,000			336,000
Other permanent items		45,000			48,000
	$	887,000		$	1,371,000

We have deferred tax assets which arise primarily due to depreciation recorded at different rates for tax and book purposes offset by cost basis differences in depreciable assets due to the deferral of the recognition of insurance recoveries on casualty losses for tax purposes, investments in and management fees paid by limited partnerships, accruals for potential uninsured claims, bonuses accrued for book purposes but not paid within two and a half months for tax purposes, the capitalization of certain inventory costs for tax purposes not recognized for financial reporting purposes, the recognition of revenue from gift cards not redeemed within twelve months of issuance, allowances for uncollectable receivables, unfunded limited retirement commitments and tax credit carryforwards generated as a result of the application of alternative minimum taxes.

The components of our deferred tax assets at September 28, 2019 and September 29, 2018 were as follows:

	2019			2018
Current:
Reversal of aged payables	$	19,000		$	20,000
Capitalized inventory costs		20,000			23,000
Accrued bonuses		251,000			270,000
Accruals for potential uninsured claims		23,000			22,000
Gift cards		143,000			106,000
Limited partnership management fees		(325,000	)		(267,000	)
	$	131,000		$	174,000

Long-Term:
Book/tax differences in property and equipment	$	(205,000	)	$	154,000
Limited partnership investments		254,000			217,000
Accrued limited retirement		69,000			67,000
	$	118,000		$	438,000
Total Deferred Tax Assets	$	249,000		$	612,000