Income Taxes

3 Months Ended

Jun. 30, 2013

Income Tax Disclosure [Abstract]

Income Taxes

7. Income Taxes

The Company recognizes deferred tax assets and liabilities for future tax consequences of temporary differences between the carrying amounts of assets and liabilities and their respective tax bases.  Deferred tax assets and liabilities are measured using enacted tax rates applicable to the years in which those differences are expected to be settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in net income in the period that includes the enactment date.

The income tax provision consists of the following for the three months ended June 30, 2013 and 2012:

	2013			2012
Current income tax expense	$	-		$	-
Deferred income tax benefit		6,818			(69,584	)
Total income tax provision	$	6,818		$	(69,584	)
Effective tax rate		30	%		(52	%)

As of June 30, 2013, the Company has a statutory depletion carryforward of approximately $4,300,000, which does not expire.  At June 30, 2013, there was a net operating loss carryforward for regular income tax reporting purposes of approximately $4,000,000, which will begin expiring in 2021.  The Company’s ability to use some of the net operating loss carryforward and certain other tax attributes to reduce current and future U.S. federal taxable income is subject to limitations under the Internal Revenue Code.

Any interest and penalties related to uncertain tax positions are recorded as interest expense and general and administrative expense, respectively.  As of June 30, 2013, the Company had unrecognized tax benefits of approximately $677,000.