Income Taxes
The components of income tax expense are as follows (in thousands):
|
| | | | | | | | |
| | Years Ended December 31, |
| | 2016 | | 2015 |
Current: | | |
| | |
|
Federal | | $ | 162 |
| | $ | — |
|
State | | 100 |
| | 27 |
|
Total Current | | 262 |
| | 27 |
|
Deferred: | | |
| | |
|
Federal | | 49 |
| | 365 |
|
State | | — |
| | — |
|
Total Deferred | | 49 |
| | 365 |
|
Total Tax Provision | | $ | 311 |
| | $ | 392 |
|
The following is a reconciliation of expected tax expense to actual expense (in thousands):
|
| | | | | | | | |
| | Years Ended December 31, |
| | 2016 | | 2015 |
Federal Income Tax Expense/(Benefit) | | $ | 2,274 |
| | $ | (62 | ) |
State Income Tax | | 198 |
| | 494 |
|
Nondeductible Expenses | | 168 |
| | 40 |
|
Provision to Return Reconciling Items | | 3,112 |
| | (3,211 | ) |
Change in Valuation Allowance | | (5,442 | ) | | 3,229 |
|
Other | | 1 |
| | (98 | ) |
Total Tax Provision | | $ | 311 |
| | $ | 392 |
|
Note 13 - Income Taxes - continued
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities, for financial reporting purposes, and amounts used for Federal income tax purposes. The components of deferred tax assets and liabilities are as follows (in thousands):
|
| | | | | | | | |
| | December 31, |
| | 2016 | | 2015 |
Deferred Tax Assets: | | | | |
Federal and State Net Operating Loss Carry-Forward | | $ | 20,361 |
| | $ | 25,986 |
|
Share-Based Compensation | | 1,084 |
| | 1,151 |
|
Other Temporary Differences | | 1,167 |
| | 1,051 |
|
Total | | $ | 22,612 |
| | $ | 28,188 |
|
| | | | |
Deferred Tax Liabilities | | | | |
Tax Goodwill | | $ | (414 | ) | | $ | (365 | ) |
Depreciation | | (276 | ) | | (280 | ) |
Other Temporary Differences | | — |
| | (130 | ) |
Total | | $ | (690 | ) | | $ | (775 | ) |
| | | | |
Net Deferred Tax Asset | | $ | 21,922 |
| | $ | 27,413 |
|
Valuation Allowance | | (22,336 | ) | | (27,778 | ) |
Deferred Tax Liability | | $ | (414 | ) | | $ | (365 | ) |
At December 31, 2016, the Company had available, net operating loss carry-forwards of approximately $59.5 million for Federal income tax purposes and net operating loss carry-forwards of approximately $2.7 million for State income tax purposes, which will begin to expire in 2019. Utilization by the Company is subject to limitations based on the Company's future income, and pursuant to Section 382 of the Internal Revenue Code. The usage of some of these net operating loss carry-forwards may be limited due to changes in ownership that have occurred or may occur in the future.