Income Taxes

The provision (benefit) for income taxes was comprised of the following:



	Year ended
	December 29, 2019			December 30, 2018			December 31, 2017
Current:
Federal	$	(260	)	$	—		$	—
State	119			326			30
	(141		)	326			30

Deferred:
Federal	(9,768		)	(598		)	(219		)
State	(2,214		)	115			793
	(11,982		)	(483		)	574
Provision (benefit) for income taxes	$	(12,123	)	$	(157	)	$	604

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amount used for income tax purposes.

The components of deferred income tax assets and liabilities at December 29, 2019 and December 30, 2018 were as follows:



	December 29, 2019			December 30, 2018
Deferred income tax assets:
Deferred income on sale-leaseback of certain real estate	$	—		$	2,505
Interest expense limitation under section 163 (j)	2,558			—
Lease financing obligations	190			182
Operating lease liabilities	218,503			—
Postretirement benefit obligations	944			935
Stock-based compensation expense	1,274			1,326
Federal net operating loss carryforwards	30,588			18,955
State net operating loss carryforwards	5,388			3,902
Goodwill and other intangibles, net	548			1,301
Occupancy costs	275			6,091
Tax credit carryforwards	32,378			28,827
Accrued vacation benefits	2,440			2,060
Accrued workers compensation	1,310			1,189
Accumulated other comprehensive income-postretirement benefits	(280		)	140
Other	2,367			1,983
Total deferred income tax assets	$	298,483		$	69,396

Deferred income tax liabilities:
Operating right-of-use assets	(208,804		)	—
Inventory and other reserves	(252		)	(167		)
Property and equipment depreciation	(29,685		)	(19,870		)
Franchise rights	(66,725		)	(21,068		)
Total deferred income tax liabilities	(305,466		)	(41,105		)

Carrying value of net deferred income tax assets (liabilities)	$	(6,983	)	$	28,291

The Company's federal net operating loss carryforwards generated prior to December 31, 2017 expire beginning in 2033. Federal net operating losses generated in 2018 and 2019 have no expiration date. As of December 29, 2019, the Company had federal net operating loss carryforwards of approximately $145.7 million. The Company's state net operating loss carryforwards expire beginning in 2021 through 2038.

The Company has performed the required assessment of positive and negative evidence regarding the realization of deferred income tax assets in accordance with ASC 740 at December 29, 2019 and December 30, 2018. In determining the likelihood of future realization of the deferred income tax assets as of December 29, 2019 and December 30, 2018 the Company considered both positive and negative evidence and weighted the effect of such evidence based upon it's objectivity. The Company believes that the weight of the positive evidence from the reversal of deferred tax liabilities and forecasts for a sustained level of future taxable income, is sufficient to overcome the weight of the negative evidence and concluded that it did not need to record a valuation allowance against its net deferred income tax assets at December 29, 2019.

A reconciliation of the statutory federal income tax provision to the income tax provision (benefit) for the years ended December 29, 2019, December 30, 2018, and December 31, 2017 was as follows:



	Year ended
	December 29, 2019			December 30, 2018			December 31, 2017
Statutory federal income tax provision (benefit)	$	(9,249	)	$	2,089		$	2,717
State income taxes, net of federal benefit	(1,655		)	325			572
Employment tax credits	(2,938		)	(3,059		)	(1,947		)
Non-deductible expenses	1,374			415			336
Federal rate change	—			—			(762		)
Miscellaneous	345			73			(312		)
Provision (benefit) for income taxes	$	(12,123	)	$	(157	)	$	604

The Company's policy is to recognize interest and/or penalties related to uncertain tax positions in income tax expense. At December 29, 2019 and December 30, 2018, the Company had no unrecognized tax benefits and no accrued interest related to uncertain tax positions. The tax years 2013 - 2019 remain open to examination by the major taxing jurisdictions to which the Company is subject. Although it is not reasonably possible to estimate the amount by which unrecognized tax benefits may increase within the next twelve months due to uncertainties regarding the timing of examinations, the Company does not expect unrecognized tax benefits to significantly change in the next twelve months.

On December 22, 2017, the Tax Cuts and Jobs Act (the "Act") was signed into law. The Act reduces the federal corporate tax rate to 21% from 35% while retaining the employment tax credits the Company is eligible for. In addition, the Act provides for one hundred percent expensing of certain qualified property placed in service after September 27, 2017.

The Company recorded a $0.8 million discrete tax benefit in 2017 to remeasure its net deferred taxes due to the lowering of the Federal income tax statutory rate to 21% under the Act. The measurement of general business credits, which are a large component of offsetting deferred tax assets, was not affected by the Act with the exception of making a final determination on whether or not to opt out of the one hundred percent expensing provision.

The benefit for income taxes for the years ended December 29, 2019 and December 30, 2018 contained net discrete tax adjustments of $0.5 million of income tax expense and $0.1 million of income tax expense, respectively.