The total provision (benefit) for income taxes consists of the following for the fiscal years ended (dollars in thousands):

	Fiscal Year Ended March 31,
	2019			2018			2017
Current	$	(5	)	$	4		$	(261	)
Deferred		19			(19	)		—
Total	$	14		$	(15	)	$	(261	)

	2019			2018			2017
Federal	$	3		$	(28	)	$	(283	)
State		11			13			22
Total	$	14		$	(15	)	$	(261	)

A reconciliation of the statutory federal income tax rate and effective income tax rate is as follows:

	Fiscal Year Ended March 31,
	2019			2018			2017
Statutory federal tax rate		21.0	%		30.8	%		34.0	%
State taxes, net		5.6	%		2.2	%		3.5	%
Federal tax credit		(0.3	)%		(0.3	)%		—	%
Change in valuation reserve		(23.8	)%		51.4	%		(37.6	)%
Permanent items		(1.1	)%		(1.4	)%		(0.5	)%
Change in tax contingency reserve		—	%		(0.1	)%		1.0	%
Federal refunds		0.3	%		0.3	%		1.4	%
U.S. tax reform, corporate rate reduction		—	%		(75.2	)%		—	%
Equity compensation cancellations		(1.0	)%		(15.7	)%		—	%
Federal loss, ASU 2016-09		—	%		7.7	%		—	%
Other, net		(0.9	)%		0.4	%		0.3	%
Effective income tax rate		(0.2	)%		0.1	%		2.1	%

The net deferred tax assets and liabilities reported in the accompanying consolidated financial statements include the following components (dollars in thousands):

	March 31,
	2019			2018
Inventory, accruals and reserves		1,118			1,316
Interest deduction carry-forward		127			—
Federal and state operating loss carry-forwards		22,909			21,333
Tax credit carry-forwards		1,921			1,939
Equity compensation		288			402
Deferred revenue		(90	)		(81	)
Fixed assets		(781	)		(878	)
Intangible assets		(300	)		(363	)
Other		194			154
Valuation allowance		(25,386	)		(23,803	)
Total net deferred tax assets	$	—		$	19

The Tax Cut and Jobs Act ("Act") was enacted December 22, 2017. The Act significantly changes U.S tax law by, among other things, reducing the U.S. federal corporate tax rate from 35% to 21%, imposing a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred, and creating new taxes on certain foreign sourced earnings.

On December 22, 2017, the SEC staff issued Staff Accounting Bulletin No. 118 (“SAB 118”) to address accounting for income tax effects of the Tax Reform Act. At March 31, 2018, Orion had not completed its accounting for the tax effects of enactment of the Act; however, as described below, Orion had made a reasonable estimate of the effects on its existing deferred tax balances and the one-time transition tax.

Orion remeasured its deferred tax assets based on the rates at which they are expected to reverse in the future, which is generally the 21% federal corporate tax rate. The provisional amount recorded related to the remeasurement of its deferred tax balance decreased deferred tax assets by $9.9 million in fiscal 2018. Substantially all of this decrease to deferred tax assets was offset by a corresponding decrease to the valuation allowance. There was no impact on the prior year income tax expense for the federal corporate tax rate change due to Orion's prior year taxable loss.

The Act also required companies to pay a one-time transition tax on Orion's total post-1986 earnings and profits ("E&P") of its foreign subsidiary that were previously tax deferred from US income taxes. Since Orion's foreign subsidiary had negative E&P, the company estimated there was no transition tax to be reported in income tax expense. As of December 31, 2018, Orion did not adjust its estimates and considered all changes due to the Act final.

As of March 31, 2019, Orion has federal net operating loss carryforwards of approximately $88.1 million, and state net operating loss carry-forwards of approximately $74.1 million. Upon adoption of ASU 2016-09, Compensation-Stock Compensation (Topic 718) Improvements to Employee Share-Based Payment Accounting, in the prior fiscal year, the federal and state loss carryforwards associated with historic exercises of NQSOs have been recorded as deferred tax assets. Orion also has federal tax credit carry-forwards of approximately $1.3 million and state tax credits of $0.8 million. All of Orion's tax credit carry-forwards and $155.1 million of its net operating loss carry-forwards will begin to expire in varying amounts between 2020 and 2039. The remaining $7.1 million of its federal and state loss carry-forwards are not subject to time restrictions but may only be used to offset 80% of adjusted taxable income. Additionally, Orion has approximately $0.5 million of interest expense carry-forward that is not subject to time restrictions but subject to a 30% adjusted taxable income limitation. All of its carry-forwards are offset by a valuation allowance

For the fiscal year ended March 31, 2019, Orion has recorded a valuation allowance of $25.4 million against its net deferred tax assets due to the uncertainty of its realization value in the future. For the fiscal year ended March 31, 2019, the valuation allowance against Orion's net federal and net state deferred tax assets increased $1.6 million, primarily due to the current year loss. For the fiscal year ended March 31, 2018, the valuation allowance decreased $6.8 million, primarily because of the reduction in the corporate tax rate. Orion considers future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for the valuation allowance. In the event that Orion determines that the deferred tax assets are able to be realized, an adjustment to the deferred tax asset would increase income in the period such determination is made.

Generally, a change of more than 50% in the ownership of Orion's stock, by value, over a three-year period constitutes an ownership change for federal income tax purposes as defined under Section 382 of the Internal Revenue Code. As a result, Orion's ability to use its net operating loss carry-forwards, attributable to the period prior to such ownership change, to offset taxable income can be subject to limitations in a particular year, which could potentially result in increased future tax liability for Orion. There was no limitation of net operating loss carry-forwards that occurred for fiscal 2019, fiscal 2018, or fiscal 2017.

Orion records its tax provision based on the respective tax rules and regulations for the jurisdictions in which it operates. Where Orion believes that a tax position is supportable for income tax purposes, the item is included in their income tax returns. Where treatment of a position is uncertain, a liability is recorded based upon the expected most likely outcome taking into consideration the technical merits of the position based on specific tax regulations and facts of each matter. These liabilities may be affected by changing interpretations of laws, rulings by tax authorities, or the expiration of the statute of limitations.

Orion files income tax returns in the United States federal jurisdiction and in several state jurisdictions. The Company's federal tax returns for tax years beginning April 1, 2015 or later are open. For states in which Orion files state income tax returns, the statute of limitations is generally open for tax years ended March 31, 2015 and forward.

State income tax returns are generally subject to examination for a period of 3 to 5 years after filing of the respective return. The state effect of any federal changes remains subject to examination by various states for a period of up to two years after formal notification to the states. Orion currently has no state income tax return positions in the process of examination, administrative appeals or litigation.

As of March 31, 2019, the balance of gross unrecognized tax benefits was approximately $0.1 million, all of which would affect Orion’s effective tax rate if recognized.

Orion has classified the amounts recorded for uncertain tax benefits in the balance sheet as other liabilities (non-current) to the extent that payment is not anticipated within one year. Orion recognizes penalties and interest related to uncertain tax liabilities in income tax expense. Penalties and interest are included in the unrecognized tax benefits. Orion had the following unrecognized tax benefit activity (dollars in thousands):

	Fiscal Year Ended March 31,
	2019		2018		2017
Unrecognized tax benefits as of beginning of fiscal year	$	129	$	113	$	227
Additions based on tax positions related to the current period positions		1		2		2
Additions/(Reductions) for tax positions of prior years		—		14		(116	)
Unrecognized tax benefits as of end of fiscal year	$	130	$	129	$	113