Note 10. Income Taxes

The components of the income tax provision for the years ended December 31, 2017 and 2016 are as follows:

	2017			2016

Current:
Federal	$	167		$	19
State		0			1
Deferred:
Federal		(31	)		(19	)
State		27			1
Total Federal and State Income Taxes	$	163		$	2

The provision for income taxes for the years ended December 31, 2017 and 2016 differs from the amount obtained by applying the U.S. federal income tax rate to pretax income due to the following:

	2017			2016

Computed “Expected” Federal Tax Expense	$	156		$	70
Increase (Decrease) in Taxes Resulting From:
State Income Taxes, net of Federal Benefit		3			2
Credits		(46	)		(63	)
Domestic Production Activities Deduction		(19	)		(5	)
Permanent Differences		4			5
Effect of U.S. Tax Law Changes (35% to 21%)		49			0
Other		16			(7	)
Total Federal and State Income Taxes	$	163		$	2

The components of the net deferred tax asset consist of:

	2017			2016

Deferred Tax Assets:
Vacation accrual	$	23		$	37
Allowance for doubtful accounts		2			3
Stock compensation		88			128
Bonus		2			0
Depreciation and amortization		17			0
Net unrealized loss on investments		0			17
State carryforward R&D credit		101			73
Valuation allowance		(28	)		0
Total Deferred Tax Assets		205			258

Deferred Tax Liabilities:
Prepaid expenses		20			40
Depreciation and amortization		0			20
Net unrealized gain on investments		3			0
Total Deferred Tax Liabilities		23			60

Net Deferred Tax Asset	$	182		$	198

The Company is subject to the following material taxing jurisdictions: U.S. and Minnesota. The tax years that remain open to examination by the Internal Revenue Service and state jurisdictions are 2014 through 2016. We have no accrued interest or penalties related to uncertain tax positions as of January 1, 2017 or December 31, 2017 and uncertain tax positions are not significant.