9. Income Taxes

Income tax (provision) benefit from continuing operations consists of the following:

	Fiscal Year Ended
	April 26, 2015			April 27, 2014		April 28, 2013
Current:
Federal	$	—		$	—	$	—
State		(167	)		7,352		(1,005	)

		(167	)		7,352		(1,005	)
Deferred:
Federal		(3,219	)		10,116		(3,888	)
State		2,275			1,026		(1,839	)

		(944	)		11,142		(5,727	)

Income tax (provision) benefit	$	(1,111	)	$	18,494	$	(6,732	)

A reconciliation of income taxes from continuing operations at the statutory corporate federal tax rate of 35% to the income tax (provision) benefit reported in the accompanying consolidated statements of operations is as follows:

	Fiscal Year Ended
	April 26, 2015			April 27, 2014			April 28, 2013
Statutory tax (provision) benefit	$	(2,201	)	$	51,856		$	16,007
Effects of :
State taxes		3,589			10,396			(459	)
Reduction of unrecognized tax benefits		—			5,010			—
Other
Lobbying & Referendum costs		(2,018	)		(607	)		(752	)
Employment tax credits		959			1,112			665
Fines & Penalties		(18	)		(26	)		(204	)
Meals & Entertainment		(48	)		(62	)		(72	)
Various permanent differences		(15	)		(16	)		(52	)
Interest		—			(446	)		(161	)
Goodwill impairment		—			(45,088	)		(17,535	)
Valuation allowance		(919	)		(2,668	)		(3,985	)
Expiration of stock awards		(611	)		—			—
Other		171			(967	)		(184	)

Income tax (provision) benefit	$	(1,111	)	$	18,494		$	(6,732	)

Significant components of our domestic net deferred income tax asset (liability) are as follows:

	Fiscal Year Ended
	April 26, 2015			April 27, 2014
Deferred tax liabilities:
Property and equipment	$	(37,421	)	$	(46,867	)
Goodwill and intangibles		(21,527	)		(16,810	)
Gain on early extinguishment of debt		(14,613	)		(19,673	)
Other		(347	)		64

Total deferred tax liabilities		(73,908	)		(83,286	)

Deferred tax assets:
Net operating losses		62,672			72,878
Employment tax credits		22,378			22,043
Accrued expenses		8,383			8,415
Alternative minimum tax credit		2,481			1,338
Other		4,105			4,748

Total deferred tax assets		100,019			109,422
Valuation allowance on deferred tax assets		(58,819	)		(57,900	)

Net deferred tax asset		41,200			51,522

Net deferred tax liability	$	(32,708	)	$	(31,764	)

Deferred income tax assets represent amounts available to reduce income taxes payable on taxable income in future years. Such assets arise from net operating loss and tax credit carryforwards, as well as from temporary basis differences in assets and liabilities between financial reporting and tax.

At April 26, 2015, we have federal net operating loss carryforwards of $105,540 for income tax purposes, with expiration dates from fiscal 2029 to 2035. Approximately $24,396 of these net operating losses are attributable to our Colorado subsidiaries and can only be used to offset income earned by these entities. The remaining federal net operating losses are subject to limitations under the internal revenue code and underlying treasury regulations, which may limit the amount ultimately utilized. We also have various state income tax net operating loss carryforwards totaling $408,362 with expiration dates from fiscal 2018 to 2035. This includes both consolidated and separate company net operating loss carryforwards. Our federal and state net operating loss carryforwards include adjustments of $13,398 and $13,550, respectively, for excess tax benefits from stock compensation deductions that have not yet been recognized for financial statement purposes. Equity will be increased if and when these deferred tax assets are realized. We also have federal general business and alternative minimum tax credit carryforwards of $24,860 for income tax purposes, with expiration dates from fiscal 2022 to 2035. Deferred income taxes related to NOL carryforwards have been classified as current or noncurrent based on their expected utilization.

We periodically evaluate the realizability of our deferred tax assets and perform an analysis in light of all available evidence, both positive and negative, consistent with the provisions of ASC 740. As of April 26, 2015, we remain in a three-year cumulative loss, which is a significant piece of negative evidence. While it is primarily the result of intangible and fixed asset impairments, and not an indication of continuing operations, we are required to give objective historical evidence significantly more weight than subjective evidence, such as forecasts of future income. Based on this evidence, we concluded that a valuation allowance should continue to be booked against our federal and most of our state deferred tax assets as of April 26, 2015.

During fiscal 2015, our Florida operations experienced their third consecutive year of substantive pretax income. After considering all of the positive and negative evidence, we concluded that our deferred income tax assets related to our Florida state operations are more likely than not to be realized. Accordingly, as of April 26, 2015, we released all of our valuation allowance against our net Florida deferred income tax assets, resulting in the $2,301 benefit in our provision for income taxes. All other state deferred tax assets have a valuation allowance as of April 26, 2015.

A reconciliation of the beginning and ending amounts of valuation allowance is as follows:

	Federal			State			Total
Balance, April 28, 2013	$	42,691		$	13,738		$	56,429
(Benefit) Provision		(10,968	)		12,439			1,471

Balance, April 27, 2014	$	31,723		$	26,177		$	57,900
(Benefit) Provision		(2,613	)		5,833			3,220
Release of Valuation Allowance		—			(2,301	)		(2,301	)

Balance, April 26, 2015	$	29,110		$	29,709		$	58,819

We allocated the income tax provision and valuation allowance between continuing operations and discontinued operations consistent with the provisions of ASC 740.

This valuation allowance does not preclude us from utilizing the deferred tax assets in the future, nor does it reflect a change in our long-term outlook. If or when recognized, the tax benefits relating to any reversal of the valuation allowance on deferred tax assets as of April 26, 2015 will be accounted for as a reduction of income tax expense. During fiscal 2015, an increase to the valuation allowance of $919 was recorded as an income tax expense, which was net of a reduction of $2,301 for the release of the valuation allowance related to the Florida state operations.

We account for unrecognized tax benefits in accordance with ASC 740. A reconciliation of the beginning and ending amounts of unrecognized tax benefits as follows:

	April 26, 2015		April 27, 2014			April 28, 2013
Beginning balance	$	—	$	4,072		$	4,072
Impact of favorable court ruling		—		(4,072	)		—

Ending balance	$	—	$	—		$	4,072

On February 13, 2014, the Supreme Court of Mississippi ruled in our favor with regard to positions taken on Mississippi income tax returns for fiscal years ending April 2002 through April 2008. As a result, we recognized a benefit of $4,072 related to principle and $4,025 related to interest. As of April 26, 2015, we do not have any uncertain tax positions.

We recorded interest expense of $0, $390 and $466 in fiscal 2015, 2014 and 2013, respectively, prior to the favorable ruling. We accrued no penalties during fiscal 2015, 2014 or 2013. As of April 28, 2013, we had recognized a liability of $3,635 for interest and no amount for penalties.

As of April 26, 2015, we were subject to U.S. federal income tax examination for fiscal years 2008 to 2014. We are also subject to state and local income tax examinations for various tax years in jurisdictions where we operate.