We provide for income taxes on taxable income at the applicable statutory rates. The following table summarizes the components of income tax expense (benefit) for the years ended October 31, 2020, 2019 and 2018 (in thousands):


	Year Ended October 31,
	2020		2019		2018
Current
Federal	$	6,043	$	3,338	$	983
State and local	1,505		299		417
Non-United States	4,445		3,879		3,356
Total current	11,993		7,516		4,756
Deferred
Federal	(64)		1,497		(5,828)
State and local	(315)		1,087		670
Non-United States	190		676		(398)
Total deferred	(189)		3,260		(5,556)
Total income tax expense (benefit)	$	11,804	$	10,776	$	(800)

For financial reporting purposes, income (loss) before income taxes for the years ended October 31, 2020, 2019 and 2018 includes the following components (in thousands):


	Year Ended October 31,
	2020		2019		2018
Domestic	$	26,229	$	(58,247)	$	9,721
Foreign	24,071		22,293		16,032
Total income (loss) before income taxes	$	50,300	$	(35,954)	$	25,753


	Year Ended October 31,
	2020		2019		2018
United States tax at statutory rate	21.0	%	21.0	%	23.3	%
State and local income tax	1.7	%	1.6	%	3.3	%
Non-United States income tax	(0.8)	%	(0.5)	%	(1.6)	%
General business credits	(2.3)	%	(4.7)	%	(0.4)	%

Other permanent differences	1.7	%	3.0	%	—	%
Deferred rate impact of enactment of tax reform	—	%	—	%	(30.5)	%
Foreign tax positions under the Act (GILTI and FDII)	2.5	%	3.3	%	—	%

Impact of deemed repatriation	—	%	(1.1)	%	4.8	%
Asset impairment charges	—	%	(50.7)	%	(1.5)	%
Return to actual adjustments	(0.3)	%	(1.9)	%	(0.5)	%
Effective tax rate	23.5	%	(30.0)	%	(3.1)	%

On December 22, 2017, the Tax Cuts and Jobs Act was signed into law. This Act reduced our federal income tax statutory rate from 35.0% to 21.0% for the fiscal years ending October 31, 2020 and October 31, 2019, and 23.3% for the fiscal year ended October 31, 2018, which reflects the period November 1, 2017 to December 31, 2017 at the previous 35.0% rate and the period January 1, 2018 to October 31, 2018 at the new 21.0% rate. This Act also imposed additional tax law changes that became effective during fiscal 2019, which include new requirements for a global intangible low-taxed income provision (GILTI) and a deduction for foreign-derived intangible income (FDII). We elected to account for the tax on GILTI as a period cost and therefore have not recorded deferred taxes related to GILTI on our foreign subsidiaries.

The October 31, 2020 effective tax rate was impacted by the true-up of our accruals and related deferred taxes from prior year filings and settled tax audits as well as $0.6 million related to the vesting or exercise of equity-based compensation awards.

The October 31, 2019 effective rate was primarily impacted by a net charge of $1.2 million related to GILTI and FDII, as well as discrete charge of $0.4 million for the adjustment of the one-time mandatory transition tax on deemed repatriation of previously tax-deferred and unremitted foreign earnings and $0.6 million related to the vesting or exercise of equity-based compensation awards. Additionally, during the year ended October 31, 2019, we recorded a $74.6 million asset impairment charge, which was primarily non-deductible, in the NA Cabinet Components segment, as further explained in Note 6, "Goodwill and Intangible Assets."

Discrete items contributing to the October 31, 2018 income tax benefit included $7.7 million for the remeasurement of our deferred income tax assets and liabilities due to the decrease in the federal corporate income tax rate, a benefit of $0.2 million for the true up of our accruals and related deferred taxes from prior year filings and settled tax audits, and a benefit of $0.2 million related to the vesting or exercise of equity-based compensation awards, partially offset by a tax expense of $1.2 million for the one-time mandatory transition tax on deemed repatriation of previously tax-deferred and unremitted foreign earnings.

Given the significance of the Tax Cuts and Jobs Act, the SEC staff issued Staff Accounting Bulletin No. 118 (SAB 118), which allows registrants to record provisional amounts during a one year “measurement period." As of October 31, 2019, we have completed the accounting for the tax effects of the Act.

In light of the Tax Cuts and Jobs Act, we repatriated $31.9 million and $24.2 million of foreign earnings from our international operations during the years ended October 31, 2020 and 2019, respectively. This was repatriation of excess cash that was a portion of the one-time mandatory transition tax discussed above. We will continue to evaluate our foreign cash position and may repatriate additional foreign earnings in the future. With the exception of the one-time mandatory transition tax on deemed repatriation of previously tax-deferred and unremitted foreign earnings, we do not anticipate any material tax impact from any potential repatriation of previously unremitted foreign earnings. If the investment in our foreign subsidiaries were completely realized, we would not incur a residual U.S. tax liability.


	October 31,
	2020		2019
Deferred tax assets:
Employee benefit obligations	$	6,634	$	7,227
Accrued liabilities and reserves	1,471		1,646
Pension and other benefit obligations	3,303		4,365
Inventory	471		632
Loss and tax credit carry forwards	2,331		2,915
Other	103		110
Total gross deferred tax assets	14,313		16,895
Less: Valuation allowance	1,493		1,560
Total deferred tax assets, net of valuation allowance	12,820		15,335
Deferred tax liabilities:
Property, plant and equipment	10,465		11,075
Goodwill and intangibles	21,471		23,623
Total deferred tax liabilities	31,936		34,698
Net deferred tax liabilities	$	19,116	$	19,363

At October 31, 2020, state operating loss carry forwards totaled $30.1 million. The majority of these losses begin to expire in 2025. Tax credits available to offset future tax liabilities totaled $0.6 million and are expected to be utilized within the next twelve months. We evaluate tax benefits of operating losses and tax credit carry forwards on an ongoing basis, including a review of historical and projected future operating results, the eligible carry forward period and other circumstances. We have recorded a valuation allowance for certain state net operating losses as of October 31, 2020 and 2019, totaling $1.5 million and $1.6 million, respectively ($1.2 million net of federal taxes for each year) for the respective periods. In assessing the need for a

The following table shows the change in the unrecognized income tax benefit associated with uncertain tax positions for the years ended October 31, 2020, 2019 and 2018 (in thousands):


	Unrecognized Income Tax Benefits




Balance at October 31, 2017	$	591
Additions for tax positions related to the current year	—
Additions for tax positions related to the prior year	15

Balance at October 31, 2018	$	606
Additions for tax positions related to the current year	—
Additions for tax positions related to the prior year	16
Reassessment of position	(66)
Balance at October 31, 2019	$	556
Additions for tax positions related to the current year	—
Additions for tax positions related to the prior year	15
Reassessment of position	(49)
Balance at October 31, 2020	$	522

As of October 31, 2020, our unrecognized tax benefit (UTB) relates to certain state tax items regarding the interpretation of tax laws and regulations. At October 31, 2020, $0.5 million is recorded as a liability for uncertain tax positions. The disallowance of the UTB would not materially affect the annual effective tax rate.

We, along with our subsidiaries, file income tax returns in the U.S. and various state jurisdictions as well as in the U.K., Germany and Canada. In certain jurisdictions, the statute of limitations has not yet expired. We generally remain subject to examination of our U.S. income tax returns for 2016 and subsequent years. We generally remain subject to examination of our various state and foreign income tax returns for a period of four to five years from the date the return was filed. The state impact of any federal changes remains subject to examination by various states for a period of up to one year after formal notification to the state of the federal change.

Judgment is required in assessing the future tax consequences of events that have been recognized in our financial statements or tax returns. The final outcome of the future tax consequences of legal proceedings, if any, as well as the outcome of competent authority proceedings, changes in regulatory tax laws, or interpretation of those tax laws could impact our financial statements. We are subject to the effect of these matters occurring in various jurisdictions. We do not believe any of the UTB at October 31, 2020 will be recognized within the next twelve months.