Income Taxes

The provision for or benefit from income taxes on continuing operations for the years ended December 31, 2013 and 2012 is comprised of the following:



	2013		2012
Current:
Federal	$	—	$	—
State	180		270
Total current	180		270
Deferred:
Federal	—		(53		)
State	—		(9		)
Total deferred	—		(62		)
Provision for income taxes	$	180	$	208

The Company performs an analysis each year to determine whether the expected future income will more likely than not be sufficient to realize the deferred tax assets. The Company's recent operating results and projections of future income weighed heavily in the Company's overall assessment. As a result of this analysis, the Company continues to maintain a full valuation allowance against its federal and state net deferred tax assets at December 31, 2013 as the Company believes that it is more likely than not that these assets will not be realized. The tax effects of significant items comprising the Company’s deferred tax assets and (liabilities) as of December 31, 2013 and 2012 are as follows:



	2013			2012
Current deferred tax assets (liabilities)
included in other current assets:
Allowances and reserves	$	1,217		$	1,742
Compensation	4,010			3,382
Valuation allowance on deferred tax assets	(5,227		)	(5,124		)
	—			—
Noncurrent deferred tax assets (liabilities)
included in other long-term assets:
State net operating loss carryforwards	4,774			4,103
Federal net operating loss carryforwards	31,253			28,615
State taxes	1,124			1,123
Self insurance and other reserves	294			338
Property, plant and equipment	2,196			2,294
Intangible assets	8,269			9,249
Other reserves - restructuring	391			410
Compensation	—			31
Deferred revenue	6			226
Valuation allowance on deferred tax assets	(48,307		)	(46,389		)
	—			—
Net deferred tax liability	$	—		$	—

Federal tax attribute carryforwards at December 31, 2013, consist primarily of approximately $89.7 million of federal net operating losses. In addition, the Company has approximately $90.1 million of state net operating losses carryforwards. The utilization of the federal carryforwards as an available offset to future taxable income is subject to limitations under federal income tax laws. If the federal net operating losses are not utilized, they begin to expire in 2027, and current state net operating losses not utilized begin to expire this year.

A reconciliation of the difference between the federal statutory tax rates and the Company's effective tax rate from continuing operations is as follows:



	2013		2012
Federal statutory rate	35.0	%	35.0	%
State income tax rate, net of Federal tax benefit	0.3	%	2.5	%
Meals and entertainment	(2.3	)%	—	%
Valuation allowance	(35.9	)%	(38.1	)%
Other non-deductible	(1.3	)%	(0.4	)%
Other taxes	—	%	0.2	%
Net change in Federal and state reserves	—	%	—	%
Effective tax rate	(4.2	)%	(0.8	)%

The following table summarizes the change in uncertain tax benefit reserves for the two years ended December 31, 2013:



	Unrecognized
	Tax Benefits
Balance of unrecognized benefits as of January 1, 2011	$	1,117
Additions for tax positions related to the current year	—
Additions for tax positions of prior years	—
Reductions for tax positions of prior years	—
Balance as of December 31, 2012	$	1,117
Additions for tax positions related to the current year	—
Additions for tax positions of prior years	—
Reductions for tax positions of prior years	—
Balance as of December 31, 2013	$	1,117

As of December 31, 2013 and 2012, the total amount of gross unrecognized tax benefits was $1.1 million in each year. The total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate as of December 31, 2013 and 2012 was $1.1 million in each year.

The Company recognized interest and penalties of $0.2 million related to uncertain tax positions in income tax expense during each of the years ended December 31, 2013 and 2012, respectively. At December 31, 2013 and 2012, accrued interest and penalties, net were $2.1 million and $1.9 million, respectively.

The Company and its subsidiaries file a U.S. Federal consolidated income tax return and consolidated and separate income tax returns in numerous states and local tax jurisdictions. The following tax years remain subject to examination as of December 31, 2013:



Jurisdiction	Tax Years
Federal	2009- 2013
State and Local	2007 - 2013

To the extent there was a failure to file a tax return in a previous year; the statute of limitation will not begin until the return is filed. There were no examinations in process by the Internal Revenue Service as of December 31, 2013. In 2014, the Company was selected for examination by the Internal Revenue Service for the tax periods ending December 31, 2012 and December 31, 2011.