Income Taxes

3 Months Ended

Mar. 31, 2013

Income Taxes [Abstract]

INCOME TAXES

NOTE 8 – INCOME TAXES

We are subject to the income tax jurisdictions of the U.S. and multiple state tax jurisdictions. Our provision for income taxes for the three months ended March 31, 2013 and 2012 was attributable to certain states. The effective income tax rate for the three months ended March 31, 2013 and 2012 was 0.2% and 3.6%, respectively.

At March 31, 2013, we have federal net operating loss carryforwards of approximately $34.4 million, the deductibility of $29.2 million of which is presently limited under Section 382 of the Internal Revenue Code. Approximately $361,000 of any net operating losses prior to the January 2009 ownership change (“the earlier change”) can be used to offset taxable income annually. In addition, we can offset our taxable income each year by approximately $274,000 of the net operating losses which incurred between the earlier change and the August 2011 ownership change. We estimate that 59.3% of the $29.2 million pre-change losses will expire and be unavailable to offset our future taxable income.

Management has evaluated our tax positions taken or to be taken on income tax returns that remain subject to examination (i.e., tax years 2009 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.