Income Taxes

All of our income is generated in the U.S. The components of income tax provision (benefit) were as follows (in thousands):



	Year Ended December 31,
	2019			2018			2017
Current federal	$	(1,052	)	$	1,222		$	(413	)
Current state	(273		)	571			331
	(1,325		)	1,793			(82		)

Deferred federal	(4,500		)	(135		)	(5,368		)
Deferred state	(874		)	(371		)	(32		)
	(5,374		)	(506		)	(5,400		)
	$	(6,699	)	$	1,287		$	(5,482	)

Income tax provision (benefit) differs from the amount computed by applying the statutory federal income tax rate to income (loss) before income taxes as follows (in thousands):



	Year Ended December 31,
	2019			2018			2017
Provision at U.S. statutory rate	$	(4,120	)	$	1,140		$	1,374
State taxes, net of federal benefit	(1,023		)	210			189
Effect of tax rate change on deferred tax assets and liabilities	—			—			(6,923		)
Permanent differences, primarily meals and entertainment	155			111			180
Stock-based compensation	(3		)	(42		)	(11		)
Other adjustments	(149		)	—			—
Tax credits	(1,833		)	(132		)	(291		)
Unrecognized tax benefits	274			—			—
	$	(6,699	)	$	1,287		$	(5,482	)

Significant components of our deferred tax assets and liabilities were as follows (in thousands):



	December 31,
	2019			2018
Deferred tax assets
Net operating losses and tax credit carryforwards	$	5,565		$	11
Accrued salaries and severance	1,060			1,089
Right-of-use liability	5,030			—
Other	3,529			1,403
	15,184			2,503
Deferred tax liabilities
Property, equipment and leasehold improvements	(12,222		)	(10,783		)
Intangible assets	(4,594		)	(3,977		)
Right-of-use asset	(5,144		)	—
Other	(190		)	(124		)
	(22,150		)	(14,884		)
	$	(6,966	)	$	(12,381	)

As of December 31, 2019, included in our net operating losses and tax credit carryforwards were the following (in thousands):



State NOLs, tax effected (expire in 2022-2039)	$	541
Federal NOLs, tax effected (no expiration date)	2,417
Federal employer FICA tips credit (expire in 2036-2039)	691
Federal research and development tax credit, net of $274 of unrecognized tax benefits (expire in 2035-2039)	1,916

We also have an AMT credit carryforward of $120,000 which is refundable over the next four years. As such, the carryforward is recognized as a tax receivable on our Consolidated Balance Sheets as of December 31, 2019.

In assessing the realizability of our deferred tax assets, we consider future taxable income expected to be generated by the projected differences between financial statement depreciation and tax depreciation, cumulative earnings generated to date and other evidence available to us. Based upon this consideration, we assessed that all of our deferred taxes are more likely than not to be realized, and, as such, we have not recorded a valuation allowance as of December 31, 2019 or 2018.

A reconciliation of the total amounts of unrecognized tax benefits is as follows (in thousands):



	2019		2018
Unrecognized tax benefits – January 1	$	—	$	—
Gross increases – tax positions in current period	274		—
Unrecognized tax benefits – December 31	$	274	$	—

Included in the balance of unrecognized tax benefits as of December 31, 2019 are $0.3 million of tax benefits that, if recognized, would affect the effective tax rate. Also included in the balance of unrecognized tax benefits as of December 31, 2019 are $0.3 million of tax benefits that, if recognized, would result in adjustments to other tax accounts, primarily deferred taxes.

Interest and penalties accrued on unrecognized tax benefits are recorded as tax expense in the period incurred. There were no interest or penalties accrued on the unrecognized tax benefits at December 31, 2019 and we do not anticipate any changes to the unrecognized tax benefits within the coming year.

Our federal tax returns for 2016 through 2019 remain subject to examination by the Internal Revenue Service (“IRS”), while our tax credit carryovers from 2015 can be examined to the extent they are utilized on a future return. Our state income tax returns for 2016 through 2019 remain subject to examination, and 2015 state income tax returns are subject to examination in state jurisdictions that have a four year statute of limitations. We are currently not under audit in any jurisdiction, and have not concluded any federal or state tax audits.