Note 10 - Income Taxes

12 Months Ended

Mar. 30, 2014

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

NOTE J - INCOME TAXES           

The income tax provision consists of the following for the fiscal years ended March 30, 2014, March 31, 2013 and March 25, 2012:          

	March 30, 2014		March 31, 2013		March 25, 2012
Federal
Current	$	2,664	$	3,237	$	1,274
Deferred		1,421		377		1,566
		4,085		3,614		2,840
State and local
Current		918		937		534
Deferred		231		120		475
		1,149		1,057		1,009
	$	5,234	$	4,671	$	3,849

The total income tax provision for the fiscal years ended March 30, 2014, March 31, 2013 and March 25, 2012 differs from the amounts computed by applying the United States Federal income tax rate of 34% to income before income taxes as a result of the following:

	March 30, 2014			March 31, 2013			March 25, 2012
Computed “expected” tax expense	$	4,611		$	4,127		$	3,412
State and local income taxes, net of Federal income tax benefit		773			633			682
Tax-exempt investment earnings		(110	)		(133	)		(178	)
Change in uncertain tax positions, net		(22	)		22			(24	)
Nondeductible meals and entertainment and other		(18	)		22			(43	)
	$	5,234		$	4,671		$	3,849

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are presented below:

	March 30, 2014			March 31, 2013
Deferred tax assets
Accrued expenses	$	162		$	166
Allowance for doubtful accounts		49			49
Deferred revenue		569			510
Deferred stock compensation		594			646
Excess of straight line over actual rent		289			316
Investment		157			-
Other		129			127
Total gross deferred tax assets	$	1,949		$	1,814
Deferred tax liabilities
Deductible prepaid expense		302			223
Unrealized gain on marketable securities		83			202
Depreciation expense		1,692			321
Deductible business interruption expenses		293			-
Amortization		287			243
Total gross deferred tax liabilities		2,657			989
Net deferred tax (liability) asset		(708	)		825
Less current portion		(26	)		(345	)
Long-term portion	$	(734	)	$	480

A valuation allowance is provided when it is more likely than not that some portion, or all, of the deferred tax assets will not be realized. We consider the level of historical taxable income, scheduled reversal of temporary differences, tax planning strategies and projected future taxable income in determining whether a valuation allowance is warranted. Based upon these considerations, management believes that it is more likely than not that the Company will realize the benefit of its gross deferred tax asset.

The following is a tabular reconciliation of the total amounts of unrecognized tax benefits, excluding interest and penalties, for the fiscal years ended March 30, 2014, March 31, 2013 and March 25, 2012.

	March 30, 2014			March 31, 2013			March 25, 2012
Unrecognized tax benefits, beginning of year	$	296		$	422		$	318
Decreases of tax positions taken in prior years		(34	)		(50	)		(41	)
Increase based on tax positions taken in current year		21			34			26
Settlements of tax positions taken in prior years		-			(110	)		-
Increase based on tax positions taken in prior years		-			-			119
Unrecognized tax benefits, end of year	$	283		$	296		$	422

The amount of unrecognized tax benefits at March 30, 2014, March 31, 2013 and March 25, 2012 were $283, $296 and $422, respectively, all of which would impact Nathan’s effective tax rate, if recognized. As of March 30, 2014 and March 31, 2013, the Company had $329 and $337, respectively, accrued for the payment of interest and penalties. For the fiscal years ended March 30, 2014, March 31, 2013 and March 25, 2012 Nathan’s recognized interest and penalties in the amounts of $43, $46, and $47, respectively. The Company believes that it is reasonably possible that decreases in unrecognized tax benefits of up to $64 may be recorded within the next year.

In May 2014, Nathan’s received notification from the Internal Revenue Service that it is seeking to review its tax return for the year ended March 31, 2013. The earliest tax years’ that are subject to examination by taxing authorities by major jurisdictions are as follows:

Jurisdiction	Fiscal Year
Federal	2011
New York State	2011
New York City	2011