Note 9 - Income Taxes

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Income Tax Disclosure [Text Block]

9 . INCOME TAXES

The Company uses a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company’s effective tax rate for

2019

and

2018

reflects the recognition of interim period tax benefits and changes to its tax valuation allowance.

In

December 2017,

The Tax Cuts and Jobs Act of

2017

(TCJA) was signed into law. The law includes significant changes to the U.S. corporate income tax system, including a Federal corporate rate reduction from

35%

to

21%,

elimination of Alternative Minimum Tax (AMT) and refund of AMT credit carryforward, limitations on the deductibility of interest expense and executive compensation, and the transition of U.S. international taxation from a worldwide tax system to a territorial tax system. The TCJA also establishes new tax laws that will affect future periods, including, but

not

limited to: (

1

) reducing the U.S. federal corporate tax rate; (

2

) limiting deductible interest expense; (

3

) modifying the tax treatment of like-kind exchanges; (

4

) generally eliminating U.S. federal income taxes on dividends from foreign subsidiaries; (

5

) imposing a new provision designed to tax global intangible low-tax income; (

6

) creating the base erosion anti-abuse tax, a new minimum tax; (

7

) limiting the use of Net Operating Loss (NOL) carryforwards created in tax years beginning after

December 31, 2017; (

8

) modifying the limitations on the use of foreign tax credits to reduce our U.S. income tax liability; and (

9

) further restricting the deductibility of certain executive compensation and fringe benefits. The Company is in the process of analyzing the regulations issued and determining an estimate of the financial impact.

In accordance with TCJA, the Company eliminated

$91.3

million of AMT NOL carry forwards at

December 31, 2018

and recognized as income tax benefit

$5.0

million from its unused AMT credit carry forwards. The Company expects to receive

50%,

or

$2.5

million, of said credit in

2019

and the remaining balance over the following

two

years.