NOTE 7 – INCOME TAXES



The components of the provision for income taxes are as follows:







Deferred tax (liabilities) assets consist of the following:







We have $4.4 million of state net operating loss carryforwards available as of March 25, 2017.  The carryforwards expire in varying amounts through 2037.  Based on all available evidence, we have determined that it is more likely than not that sufficient taxable income of the appropriate character within the carryforward period will exist for the realization of the tax benefits on existing state net operating loss carryforwards.



We believe it is more likely than not that all other future tax benefits will be realized as a result of current and future income.



A reconciliation between the U. S. federal statutory tax rate and the effective tax rate reflected in the accompanying financial statements is as follows:





 

The following is a rollforward of Monro’s liability for income taxes associated with unrecognized tax benefits:







The total amount of unrecognized tax benefits was $6.9 million at March 25, 2017, the majority of which, if recognized, would affect the effective tax rate.



In the normal course of business, Monro provides for uncertain tax positions and the related interest and penalties, and adjusts its unrecognized tax benefits and accrued interest and penalties accordingly.  During the year ended March 28, 2015, we recognized interest and penalties of approximately $.1 million in income tax expense. Additionally, we had approximately $.4 million of interest and penalties associated with uncertain tax benefits accrued as of March 25, 2017 and March 26, 2016.



We file U.S. federal income tax returns and income tax returns in various state jurisdictions.  Monro’s fiscal 2014 through 2016 U.S. federal tax years and various state tax years remain subject to income tax examinations by tax authorities.