Note 7 - Income Taxes

12 Months Ended

Dec. 31, 2018

Notes to Financial Statements

Income Tax Disclosure [Text Block]

7

. 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,

2018

and

2017

are as follows (in thousands):

	December 31
	201 8			201 7
Net operating loss carryforwards	$	20,720		$	21,175
Net operating loss carryforwards of foreign subsidiaries		374			374
Depreciation expense		4			(14	)
Stock-based compensation expense		28			25
Other		78			94
Deferred tax assets		21,204			21,654
Valuation allowance for deferred tax assets		(21,204	)		(21,654	)
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

2018

and

2017.

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

December 

31,

2018

and

2017

are as follows (in thousands):

	201 8			201 7
Reconciliation of income tax benefit to statutory rate:
Income benefit at statutory rate	$	480		$	(10	)
State income taxes (benefit), net of federal income tax benefit		57			1
RTP (ISO expense)		3			—
Permanent differences		(91	)		11
Change in valuation allowance		(450	)		(11,478	)
Remeasurment of Deferreds		—			11,476
Other		1			—
	$	—		$	—

At

December 

31,

2018,

we had federal net operating loss carryforwards of approximately

$86.0

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.