Note 11 - Income Taxes

9 Months Ended

Sep. 25, 2021

Notes to Financial Statements

Income Tax Disclosure [Text Block]

(11)   Income Taxes

A valuation allowance against deferred tax assets 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. In December 2018, the Company established a valuation allowance reserve, as it was judged more likely than not that all or a portion of its deferred tax assets will not be utilized before they expire. This decision was reached after giving greater weight to the Company’s losses from 2016 - 2018 as compared to its forecasts.

           In September 2021 the Company evaluated the valuation allowance against deferred tax assets. As a result of the Company’s profitability in recent years and its forecasts for future profitability.  The Company believes that it is “more likely than not” that the Company will be able to fully utilize the deferred tax asset before the assets begin to expire.  This reversal of the valuation allowance was made net of the expected tax liability for 2021.