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Income Taxes
9 Months Ended
Jun. 30, 2017
Income Tax Disclosure [Abstract]  
Income Taxes
9. Income Taxes
The Company’s effective income tax rate for the interim periods is based on management’s estimate of the Company’s annual effective tax rate for the applicable year. It is also affected by discrete items that may occur in any given period. The rates differ from the federal statutory income tax rate primarily due to state income taxes and nondeductible permanent differences such as meals and nondeductible compensation. For the three and nine months ended June 30, 2017, the Company’s effective income tax rate was 37.5% and 38.5%, respectively, as compared to an effective tax rate of 47.0% and 65.8%, respectively, for the three and nine months ended June 30, 2016. The higher effective tax rate for the three and nine months ended June 30, 2016 is primarily due to $10.5 million of stock-based compensation expense related to certain awards under our former equity compensation plan that vested in October 2015, which was not deductible for tax purposes.
The Company files a federal consolidated return and files various state income tax returns and, generally, is no longer subject to income tax examinations by the taxing authorities for years prior to September 30, 2014. The Company did not have a reserve for uncertain income tax positions at June 30, 2017 and September 30, 2016. The Company does not expect any significant changes to unrecognized tax benefits within the next twelve months. The Company’s policy is to recognize interest and penalties related to unrecognized tax benefits as charges to income tax expense.