13. Income Taxes

The provision for income taxes for fiscal years 2015, 2014 and 2013 were as follows (in thousands):



	Fiscal Year
	2015		2014			2013
Current
Federal	$	8,277	$	7,630		$	3,955
State	882		913			263
Total current	9,159		8,543			4,218
Deferred
Federal	3,937		586			1,416
State	414		(30		)	717
Total deferred	4,351		556			2,133
Total income tax provision	$	13,510	$	9,099		$	6,351

A reconciliation of income taxes computed by applying the expected federal statutory income tax rates of 35% for fiscal years 2015 and 2014, and 34% for fiscal year 2013 to income before income taxes to the total income tax provision reported in the Consolidated Statements of Comprehensive Income is as follows (in thousands):



	Fiscal Year
	2015			2014			2013
Federal income tax at statutory rate	$	13,065		$	9,732		$	5,660
State income taxes, net of federal benefit	1,104			849			597
Domestic production activities deduction	(561		)	(783		)	(123		)
Tax credits	(374		)	(319		)	(595		)
Change in deferred tax rate	92			(557		)	966
Other	184			177			(154		)
Total income tax provision	$	13,510		$	9,099		$	6,351

Net current deferred tax assets and net long-term deferred tax liabilities were as follows (in thousands):



	March 28, 2015			March 29, 2014
Net current deferred tax assets (liabilities)
Warranty reserves	$	3,714		$	3,447
Salaries and wages	2,354			2,432
Inventory	1,305			1,164
Policy acquisition costs	(1,136		)	(946		)
Deferred revenue	1,132			951
Repurchase reserves	962			831
Insurance reserves	628			655
Net operating loss carryforwards	246			3,653
Other	(632		)	126
	$	8,573		$	12,313
Net long-term deferred tax (liabilities) assets
Goodwill	$	(24,714	)	$	(24,597	)
Loan discount	8,519			9,509
Property, plant, equipment and depreciation	(4,970		)	(5,454		)
Stock based compensation	2,648			2,094
Other intangibles	(2,416		)	(2,833		)
Deferred margin	1,117			1,625
Bond discount	(925		)	(1,036		)
Buydown points	(569		)	(662		)
Reserves related to consumer loans sold	350			402
Net operating loss carryforwards	156			665
Tax credits	155			159
Other	62			180
	$	(20,587	)	$	(19,948	)

The effective income tax rate for the current year was positively impacted from the timing of certain tax credits and deductions. As Cavco’s taxable income has grown, we have realized additional benefit from tax deductions established to favor domestic manufacturing operations. We also received benefit from tax credits, including the Work Opportunity Tax Credit and the Energy Efficient Home Credit, which expired on December 31, 2014, and if not renewed, we will no longer be able to utilize these tax credits in the future.

During fiscal year 2013, the Company recognized an additional income tax benefit of $966,000 resulting from changes in state income tax rates applied to the Company's deferred tax amounts and income projections reaching a higher federal income tax rate.

The Company recorded an insignificant amount of unrecognized tax benefits during fiscal years 2015, 2014 and 2013, and there would be an insignificant effect on the effective tax rate if all unrecognized tax benefits were recognized. The Company classifies interest and penalties related to unrecognized tax benefits in income tax expense. At March 28, 2015, the Company has state net operating loss carryforwards that total $20.8 million, that begin to expire in 2015. As a result, the Company recorded a $215,000 valuation allowance against the related deferred tax asset.

The Company periodically evaluates the deferred tax assets based on the requirements established in ASC 740 which requires the recording of a valuation allowance when it is more likely than not that some portion or all of the deferred tax assets will not be realized. The determination of the need for or amount of any valuation allowance involves significant management judgment and is based upon the evaluation of both positive and negative evidence, including management projections of anticipated taxable income. At March 28, 2015, the Company evaluated forecasted taxable income and determined that, except as described above, all of the deferred tax assets would be utilized in future periods. Ultimate realization of the deferred tax assets depends on our ability to meet these forecasts in future periods.

Income tax returns are filed in the U.S. federal jurisdiction and in several state jurisdictions. The Company is no longer subject to examination by the IRS for years before fiscal year 2012. The Company believes that its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material change to the Company’s financial position. The total amount of unrecognized tax benefit related to any particular tax position is not anticipated to change significantly within the next 12 months. The provision for income taxes generally represents income taxes paid or payable for the current year plus the change in deferred taxes during the year.