Income Taxes

12 Months Ended

Dec. 27, 2014

Income Tax Disclosure [Abstract]

Income Taxes

(8) Income Taxes

Components of income tax expense (benefit) for each year are as follows:

		2014		2013		2012
Current
Federal	$	15,985	$	33,777	$	—
State		1,011		456		456
Current income tax provision:		16,996		34,233		456
Deferred:
United States:
Federal		200,926		379,574		(1,165,700)
State		226		48,900		(140,456)
Deferred income tax provision (benefit), net		201,152		428,474		(1,306,156)
Total	$	218,148	$	462,707	$	(1,305,700)

Deferred tax assets as of December 27, 2014 and December 28, 2013 are as follows:

		December 27, 2014		December 28, 2013
Deferred Tax Assets:
Net operating loss
carryforwards	$	282,000	$	734,000
Stock compensation		459,000		343,000
Credit carryforwards		1,029,000		859,000
Inventory		363,000		319,000
Accrued liabilities		34,000		39,000
Depreciation		130,000		177,000
Other		4,000		5,000
Gross deferred tax assets		2,300,000		2,476,000
Valuation allowance		—		—
Net deferred tax assets	$	2,300,000	$	2,476,000

At December 27, 2014 and December 28, 2013, the Company had net operating loss carryforwards of approximately $750,000 and $1,710,000 respectively available to offset future income for U.S. Federal income tax purposes. These operating loss carryforwards expire in 2032.

During 2014, the Company utilized approximately $1,200,000 of net operating loss carryforwards.

A valuation allowance is required to be established or maintained when it is "more likely than not" that all or a portion of deferred tax assets will not be realized. The Company believes that it will generate sufficient future taxable income to realize the tax benefits related to the remaining deferred tax assets.

A summary of the change in the deferred tax asset is as follows:

		2014		2013		2012
Balance at beginning of year	$	2,475,902	$	2,786,973	$	1,480,817
Deferred tax (expense) benefit		(175,437)		(311,071)		1,306,156
Balance at end of year	$	2,300,465	$	2,475,902	$	2,786,973

Income tax (benefit) expense is different from the amounts computed by applying the U.S. federal statutory income tax rate of 34 percent to pretax income as a result of the following:

		2014		2013		2012
Tax at statutory rate	$	415,000	$	486,000	$	(961,000)
State tax, net
of federal benefit		1,000		33,000		(140,000)
Tax credits and other
Permanent differences		(198,000)		(56,000)		(205,000)
Total	$	218,000	$	463,000	$	(1,306,000)

The Company’s income tax filings are subject to review and examination by federal and state taxing authorities. The Company is currently open to audit under the applicable statutes of limitations for the years 2011 through 2014.

At December 27, 2014 the Company’s Deferred Tax Asset included net operating loss carryforwards and other temporary differences which will require taxable income of approximately $5.8 million to fully utilize, assuming an effective corporate tax rate of 39%. The Company has concluded that it is more likely than not that its Deferred Tax Asset will be fully realized.