v2.4.0.6
Income Taxes
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12 Months Ended |
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Income Taxes [Abstract] |
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Income Taxes |
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The Company files income tax returns in the U.S. federal jurisdiction and various states. With few exceptions, the Company is subject to U.S. federal, state and local income tax examinations for the years 2009 through 2012. However, certain returns from years prior to 2009, in which net operating losses and tax credits have arisen, are still open for examination by the tax authorities.
Significant components of the Company's deferred tax assets and liabilities are as follows:
| | | | | | 2012 | | | 2011 | | Deferred tax assets and liabilities: | | | | | | | Accrued liabilities | | $ | (73,000 | ) | | $ | 131,000 | | Beneficial conversion feature on convertible financial instruments | | | (449,000) | | | | (927,000 | ) | Intangible assets | | | 1,117,000 | | | | 249,000 | | Property and equipment | | | 89,000 | | | | (18,000 | ) | R&D Credit Carryforward | | | 1,407,356 | | | | 494,000 | | Stock Compensation | | | 213,000 | | | | — | | Adjust accrued earn-out liability | | | 567,947 | | | | — | | Charitable Contributions | | | 3,000 | | | | — | | Patent fees | | | 6,000 | | | | — | | Net operating loss | | | 15,487,000 | | | | 15,524,000 | | Net deferred tax assets | | $ | 18,368,303 | | | $ | 15,453,000 | | | | | | | | | | | Valuation allowance | | | (18,368,303 | ) | | | (15,453,000 | ) | | | $ | — | | | $ | — | |
The reconciliation of the Federal statutory income tax rate of 34% to the effective rate is as follows:
| | 12/31/2012 | | | 12/31/2011 | | Federal statutory rate | | | 34.00 | % | | | 34.00 | % | State taxes, net of federal benefit | | | 3.40 | % | | | 5.34 | % | Permanent items & other | | | 6.51 | % | | | (11.30 | %) | Valuation allowance | | | (43.91 | %) | | | (28.04 | %) | | | | — | % | | | — | % |
Income taxes are based on estimates of the annual effective tax rate and evaluations of possible future events and transactions and may be subject to subsequent refinement or revision. The Company has incurred net losses since its inception, and therefore, no current income tax liabilities have been incurred for the periods presented. The amount of federal operating loss carryforwards was approximately $42,700,000 at December 31, 2012, and $41,400,000 at December 31, 2011. The loss carryforwards will expire at various dates beginning in 2026 through 2032 if not utilized. A valuation allowance is recorded to reduce the deferred tax assets reported if, based on the weight of the evidence, it is more likely than not that a portion or none of the deferred tax assets will be realized. After consideration of all the evidence, including reversal of deferred tax liabilities, future taxable income and other factors, management has determined that a full valuation allowance is necessary as of December 31, 2012 and 2011. Additionally, the Company has various tax credit carryforwards of approximately $1,400,000 as of December 31, 2012. The tax credit carryforwards will expire at various dates beginning in 2025 through 2032 if not utilized.
The Company's net operating losses and credits could be subject to annual limitations due to ownership change limitations provided by Internal Revenue Code Section 382. An annual limitation could result in the expiration of net operating losses and tax credit carryforward before utilization. At this time the Company does not believe its carryforwards or credits will be materially impacted by such limitations. |
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- Definition
The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 109
-Paragraph 136, 172
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.
Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(h))
-URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690
Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 08
-Paragraph h
-Article 4
Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319
Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 109
-Paragraph 43, 44, 45, 46, 47, 48, 49
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.
Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32537-109319
Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319
Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32559-109319
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