Annual report pursuant to Section 13 and 15(d)

Income Taxes

v3.10.0.1
Income Taxes
12 Months Ended
Sep. 30, 2018
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes

The provision (benefit) for income tax for the years ended September 30, 2018, 2017 and 2016 consists of the following:

(in thousands)
Fiscal Year Ended September 30,
 
2018
 
2017
 
2016
Current:
 

 
 

 
 

Federal income tax
$
1,961

 
$
102

 
$
244

State income tax
384

 

 

Total current
2,345

 
102

 
244

 
 
 
 
 
 
Deferred:
 

 
 

 
 

Federal income tax
(3,917
)
 
(3,286
)
 
4,538

State income tax
1,962

 
(662
)
 
739

Total deferred
(1,955
)
 
(3,948
)
 
5,277

Provision (benefit) for income taxes
$
390

 
$
(3,846
)
 
$
5,521



Income tax provision (benefit) attributable to income from continuing operations differed from the amount computed by applying the statutory federal income tax rate of 24.53%, based on a blended rate calculation, to income (loss) before income taxes for the fiscal year ended September 30, 2018 and 35% for the fiscal years ended September 30, 2017 and 2016 as a result of the following:

(in thousands)
Fiscal Year Ended September 30,
 
2018
 
2017
 
2016
Tax at the statutory federal rate
$
3,198

 
$
(4,670
)
 
$
4,382

Increase (decrease) resulting from:
 

 
 

 
 

State income taxes, net of federal benefit
857

 
(402
)
 
457

Permanent and other reconciling items, net
221

 
548

 
773

Expiration of capital loss carryforward
5,634

 
581

 

Reduction in deferred tax liability resulting from the Act
(9,847
)
 

 

Stock option cancellation
347

 

 

Other
(20
)
 
97

 
(91
)
Provision (benefit) for income taxes
$
390

 
$
(3,846
)
 
$
5,521



The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities as of September 30, 2018, and 2017 are presented below:

(in thousands)
September 30,
 
2018
 
2017
Deferred tax assets:
 

 
 

Deferred retirement benefits
$
1,114

 
$
1,712

Investment in Citree
89

 
45

Deferred gain recognition
6,318

 
10,199

Goodwill
20,095

 
33,233

Inventories
711

 
6,435

Stock compensation
261

 
292

Accrued bonus
612

 
248

Capital loss carryforwards

 
9,462

Tax credits
28

 
293

Net operating losses

 
3,160

Intangibles
620

 
1,027

Other
190

 
332

Total deferred tax assets
30,038

 
66,438

 
 
 
 
Deferred tax liabilities:
 
 
 
Revenue recognized from citrus and sugarcane
162

 
357

Property and equipment
54,925

 
91,995

Accrual-to-cash method

 
950

Prepaid insurance
104

 
220

Investment in Magnolia

 
24

Total deferred tax liabilities
55,191

 
93,546

Net deferred income tax liabilities
$
(25,153
)
 
$
(27,108
)


On December 22, 2017, the U.S. Tax Cuts and Jobs Act (the “Act”) was signed into law. The Act contains significant changes to corporate taxes, including a permanent reduction of the U.S. corporate tax rate from 35% to 21% effective January 1, 2018. The Company’s statutory rate for fiscal year ended September 30, 2018 was 24.53%, based on a fiscal year blended rate calculation. The 21% U.S. corporate tax rate will apply to fiscal years ending September 30, 2019 and each year thereafter.

Additionally, the Act requires a one-time remeasurement of certain tax related assets and liabilities. During the first fiscal quarter ended December 31, 2017, the Company made certain estimates related to the impact of the Act, including the remeasurement of deferred taxes at the new expected tax rate and a revised effective tax rate for the fiscal year ended September 30, 2018. The amounts recorded for the fiscal year ended September 30, 2018 for the remeasurement of deferred taxes principally relate to the reduction in the U.S. corporate income tax rate. For the fiscal year ended September 30, 2018, the Company has recorded a tax benefit of approximately $9,847,000 to account for these deferred tax impacts.