Astronics Corporation Annual report pursuant to Section 13 and 15(d)

INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2013

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

The effective tax rates differ from the statutory federal income tax rate as follows:


	2013			2012			2011
Statutory Federal Income Tax Rate		35.0	%		35.0	%		35.0	%
Permanent Items
Non-deductible Stock Compensation Expense		1.0	%		1.1	%		1.0	%
Domestic Production Activity Deduction		(3.0	)%		(3.0	)%		(2.9	)%
Non-deductible Acquisition Costs		1.0	%		—	%		—	%
Other		—	%		0.1	%		(0.2	)%
Foreign Tax Benefits		(0.3	)%		(1.2	)%		(1.0	)%
State Income Tax (Benefits), Net of Federal Income Tax Effect		(0.1	)%		(0.1	)%		1.4	%
Research and Development Tax Credits		(5.0	)%		(1.1	)%		(6.1	)%
Other		—	%		(0.1	)%		(1.6	)%

Effective Tax Rate		28.6	%		30.7	%		25.6	%

Significant components of the Company’s deferred tax assets and liabilities as of December 31, are as follows:


	2013			2012
(In thousands)
Deferred Tax Assets:
Goodwill and Intangible Assets	$	3,367		$	6,918
Asset Reserves		5,780			4,901
Deferred Compensation		6,564			6,656
State Investment Tax Credit Carryforwards, Net of Federal Tax		665			665
Customer Advanced Payments and Deferred Revenue		956			1,113
State Net Operating Loss Carryforwards and Other		2,639			729

Total Gross Deferred Tax Assets		19,971			20,982
Valuation Allowance for State and Foreign Deferred Tax Assets and Tax Credit Carryforwards, Net of Federal Tax		(2,509	)		(2,190	)

Deferred Tax Assets		17,462			18,792


Deferred Tax Liabilities:
Depreciation		7,164			4,806
Intangible Assets		27,742			—
Other		2,465			—

Deferred Tax Liabilities		37,371			4,806


Net Deferred Tax Asset (Liabilities)	$	(19,909	)	$	13,986

The net deferred tax assets and liabilities presented in the Consolidated Balance Sheets are as follows at December 31:


(In thousands)	2013			2012
Deferred Tax Asset — Current	$	5,291		$	4,967
Deferred Tax Asset — Long-term		—			9,019
Deferred Tax Liabilities — Current		(970	)		—
Deferred Tax Liabilities — Long-term		(24,230	)		—

Net Deferred Tax Liability	$	(19,909	)	$	13,986

A reconciliation of the total amounts of unrecognized tax benefits, excluding interest and penalties which are insignificant, is as follows:


(in thousands)	2013		2012			2011
Balance at Beginning of the Year	$	840	$	880		$	1,470
Increases (Decreases) as a Result of Tax Positions Taken in Prior Years		145		(220	)		(1,090	)
Increases as a Result of Tax Positions Taken in the Current Year		955		180			500

Balance at End of the Year	$	1,940	$	840		$	880