Note 8 - Income Taxes

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Income Tax Disclosure [Text Block]

8.

Income Taxes

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of our deferred tax assets (liabilities) as of

December

 

31,

2016

and

2015

are as follows (in thousands):

	December 31
	201 6			201 5
Net operating loss carryforwards	$	32,644		$	31,777
Net operating loss carryforwards of foreign subsidiaries		374			374
Book over tax depreciation		(48	)		(62	)
Stock-based compensation expense		38			25
Other		124			128
Deferred tax assets		33,132			32,242
Valuation allowance for deferred tax assets		(33,132	)		(32,242	)
Deferred tax assets, net of allowance	$	—		$	—

Deferred tax assets are required to be reduced by a valuation allowance if it is more likely than not that some portion or all of the deferred tax assets will not be realized. Realization of the future benefits related to the deferred tax assets is dependent on many factors, including the Company’s ability to generate taxable income within the near to medium term. Management has considered these factors in determining the valuation allowance for

2016

and

2015.

The differences between the provision for income taxes and income taxes computed using the federal statutory rate for the years ended

December

 

31,

2016

and

2015

are as follows (in thousands):

	2016			2015
Reconciliation of income tax benefit to statutory rate:
Income benefit at statutory rate	$	(528	)	$	(425	)
State income taxes (benefit), net of federal income tax benefit		(40	)		(28	)
RTP (ISO expense)		38			116
Permanent differences		28			65
Change in valuation allowance		890			(316	)
Change in state tax rate		(345	)		577
Other		(43	)		11
	$	—		$	—

At

December

 

31,

2016,

we had federal net operating loss carryforwards of approximately

$88.0

million for income tax purposes that begin to expire in

2022

and are subject to the ownership change limitations under Internal Revenue Code Section 

382.

We also have approximately

$6

million of state net operating loss carryforwards that begin to expire in

2017.