Income Taxes

6 Months Ended

Jun. 30, 2012

Income Taxes [Abstract]

INCOME TAXES

NOTE 7 – INCOME TAXES

We are subject to the income tax jurisdictions of the U.S., Puerto Rico, as well as multiple state tax jurisdictions. Our provisions for income taxes for the three and six months ended June 30, 2012 and 2011, represented solely certain state income tax expenses. The effective income tax rates for the three and six months ended June 30, 2012 were 0.1% and 0.3%, respectively. Our income before income taxes for the three and six months ended June 30, 2012, was attributable to the net profit of a subsidiary in Puerto Rico, which is currently not subject to the U.S. federal tax jurisdiction. For the three months ended June 30, 2012, our subsidiary in Puerto Rico utilized approximately $1.0 million of deferred tax assets from net operating loss carryforwards. At June 30, 2012, we have federal net operating loss carryforwards of approximately $38.4 million, the deductibility of $29.3 million of which is presently limited to approximately $361,000 annually under Section 382 of the Internal Revenue Code due to recent changes in control of the Company.

Management has evaluated our tax positions taken or to be taken on income tax returns that remain subject to examination (i.e., tax years 2008 and thereafter federally, earlier for certain other jurisdictions), and has concluded that there are no uncertain tax positions, as defined in generally accepted accounting principles, that require recognition or disclosure in the consolidated financial statements.