Income Taxes:

Our income tax expense (benefit) consists of the following for the periods presented:



	Successor			Predecessor
	Three Months Ended			Three Months Ended
	September 28, 2014			September 29, 2013
	(in thousands, except percentages)
Federal and state income taxes	$	(6,728	)	$	4,519
Foreign income taxes	(208		)	(11		)
Income tax expense (benefit)	$	(6,936	)	$	4,508
Effective rate	34.3		%	37.7		%



	Successor			Predecessor
	For the 226 Day Period Ended			For the 47 Day Period Ended			Nine Months Ended
	September 28, 2014			February 14, 2014			September 29, 2013
	(in thousands, except percentages)
Federal and state income taxes	$	(15,220	)	$	914		$	29,247
Foreign income taxes	(614		)	104			220
Income tax expense (benefit)	$	(15,834	)	$	1,018		$	29,467
Effective rate	28.4		%	59.1		%	38.1		%

Our effective income tax rate of 28.4% differs from the statutory rate for the 226 day period ended September 28, 2014 primarily due to the unfavorable impact of non-deductible transaction and litigation costs related to the Merger, and an increase in income tax expense resulting from certain state income tax credits (carried forward) and estimated to expire after 2022. These unfavorable adjustments were partially offset by the recognition of uncertain tax positions resulting from settlements and expirations of statutes of limitation. The majority of these favorable and unfavorable adjustments were recognized as discrete items in their respective periods.

Our effective income tax rate of 59.1% for the 47 day period ended February 14, 2014 differs from the statutory rate due to non-deductible transaction costs related to the Merger, a net increase in uncertain tax positions and an increase in income tax expense resulting from certain state income tax credits (carried forward) and estimated to expire after 2022.

As of September 28, 2014, we have state income tax credit carryforwards, net of federal benefits, of $1.4 million with a valuation allowance, net of federal benefit, of $0.5 million, and as of December 29, 2013, we had state income tax credit carryforwards, net of federal benefit, of $1.4 million with a valuation allowance, net of federal benefit, of $0.1 million.

Our net deferred tax liability increased from $55.7 million as of December 29, 2013 to $210.6 million as of September 28, 2014. The increase primarily relates to the tax effect of acquisition accounting adjustments made to the financial statement carrying value of our assets and liabilities of $213.2 million in connection with the Merger, partially offset by a deferred tax benefit of $1.8 million in the 47 day period ended February 14, 2014 and a deferred tax benefit of $56.5 million in the 226 day period ended September 28, 2014.

Our liability for uncertain tax positions (excluding interest and penalties) was $2.2 million and $2.6 million as of September 28, 2014 and December 29, 2013, respectively, and if recognized would decrease our provision for income taxes by $1.4 million. Within the next twelve months, we could settle or otherwise conclude certain ongoing income tax audits. As such, it is reasonably possible that the liability for uncertain tax positions could decrease by as much as $0.4 million as a result of settlements with certain taxing authorities and expiring statutes of limitations within the next twelve months.

The total accrued interest and penalties related to unrecognized tax benefits as of September 28, 2014 and December 29, 2013, was $1.6 million and $1.9 million, respectively. On the Consolidated Balance Sheets, we include current accrued interest related to unrecognized tax benefits in "Accrued interest," current accrued penalties in "Accrued expenses" and noncurrent accrued interest and penalties in "Other noncurrent liabilities."