Income Taxes (Tables)

12 Months Ended

Jun. 04, 2013

Income Taxes [Abstract]

Components of income tax expense/(benefit)

Income tax (benefit)/expense for fiscal 2013, 2012, and 2011 was allocated as follows (in thousands):

	2013			2012			2011
Provision/(benefit) for income taxes from
continuing operations	$	1,500		$	(12,152	)	$	7,563
Benefit for income taxes from
discontinued operations		(8,519	)		(2,598	)		(1,819	)
Total (benefit)/provision for income taxes	$	(7,019	)	$	(14,750	)	$	5,744

Income tax expense/(benefit) from continuing operations includes the following components (in thousands):

	2013			2012			2011
Current:
Federal	$	8,966		$	3,169		$	6,022
State		1,200			3,321			1,687
Foreign		163			155			132
		10,329			6,645			7,841
Deferred:
Federal		(8,397	)		(17,402	)		(1,200	)
State		(432	)		(1,395	)		922
		(8,829	)		(18,797	)		(278	)
	$	1,500		$	(12,152	)	$	7,563

Deferred tax assets and liabilities

Deferred tax assets and liabilities are comprised of the following (in thousands):

	2013			2012
Deferred tax assets:
General business credits carryforward	$	31,063		$	21,675
Employee benefits		22,485			27,510
Escalating minimum rents		19,055			18,438
Goodwill		12,004			7,012
State net operating losses		8,394			7,672
Insurance reserves		5,777			6,500
Deferred gain on sale-leaseback transactions		5,232			1,685
Closed restaurant lease reserves		3,464			2,704
Other		16,705			9,095
Gross deferred tax assets		124,179			102,291
Deferred tax asset valuation allowances		(24,566	)		(2,392	)
Net deferred tax assets		99,613			99,899
Deferred tax liabilities:
Depreciable property and equipment		(87,542	)		(99,901	)
Other		(10,528	)		(10,431	)
Total deferred tax liabilities		(98,070	)		(110,332	)
Net deferred tax asset/(liability)	$	1,543		$	(10,433	)

Reported in Consolidated Balance Sheets as:
Deferred income taxes – current asset	$	7,296		$	27,134
Deferred income taxes – noncurrent liability		(5,753	)		(37,567	)
	$	1,543		$	(10,433	)

Reconciliation from statutory federal income tax expense to reported income tax expense/(benefit)

A reconciliation from the statutory federal income tax (benefit)/expense to the reported income tax expense/(benefit) from continuing operations is as follows (in thousands):

	2013			2012			2011
Statutory federal income taxes	$	(7,677	)	$	(3,019	)	$	19,991
State income taxes, net of federal income tax benefit		(1,484	)		(1,639	)		428
FICA tip credit		(8,189	)		(8,192	)		(8,237	)
Work opportunity tax credit		(1,366	)		(2,150	)		(2,623	)
Other federal tax credits		(155	)		(384	)		(197	)
Increase in valuation allowance		20,885			866			1,478
Other, net		(514	)		2,366			(3,277	)
	$	1,500		$	(12,152	)	$	7,563

Reconciliation of beginning and ending amount of unrecognized tax benefits

We had a liability for unrecognized tax benefits, exclusive of accrued interest and penalties, of $13.0 million at June 4, 2013, $3.5 million of which, if recognized, would impact our effective tax rate.  A reconciliation of the beginning and ending amount of unrecognized tax benefits for fiscal 2013 and 2012 follows (in thousands):

	2013			2012
Beginning of year	$	6,424		$	5,171
Additions for tax positions related to the current year		4,594			901
Additions for tax positions of prior years		4,468			2,079
Reductions for tax positions of prior years		(1,856	)		(764	)
Reductions for settlements with taxing authorities		(408	)		(110	)
Reductions due to statute settlements		(206	)		(853	)
End of year	$	13,016		$	6,424