Note 3 - Income Taxes

3 Months Ended

Mar. 31, 2016

Notes to Financial Statements

Income Tax Disclosure [Text Block]

3. INCOME TAXES

The effective tax rate for the three-month period ended March 31, 2016 decreased to 35.4% compared to 39.8% for the same period in 2015. The decrease in the effective tax rate was mainly due to a $300,000 capital loss valuation allowance due to the write-off of a purchase option in 2015 and United States federal tax examination related adjustments decreasing tax expense by $48,000 in 2016. The United States federal tax examination for the tax year ended December 31, 2013 was completed in the three-month period ended March 31, 2016.

The unrecognized tax benefit as of March 31, 2016 was $338,000, excluding interest of $3,000 and penalties of $7,000. Of this amount, $82,000 represents the net unrecognized tax benefits that, if recognized, would favorably impact the effective income tax rate. The remaining $257,000 at March 31, 2016 would have no impact on the effective tax rate, if recognized.   The Company accrues interest and penalties related to uncertain tax position in the statements of income as income tax expense.