Income Taxes

12 Months Ended

Sep. 28, 2021

Income Tax Disclosure [Abstract]

Income Taxes

7.Income Taxes:

Deferred tax assets (liabilities) are comprised of the following at the period end (in thousands):

	September 28, 2021			September 29, 2020
	Long Term			Long Term
Deferred income tax assets (liabilities):
Tax effect of net operating loss carry-forward	$	4,061		$	2,686
General business credits		4,353			3,618
Partnership/joint venture basis differences		(5	)		(2	)
Deferred revenue		65			80
Property and Equipment basis differences		(1,764	)		(1,866	)
Intangibles basis differences		678			1,087
ROU asset		(9,804	)		(10,516	)
Long-term lease liability		11,782			12,549
Other accrued liability and asset difference		5			(232	)
Deferred tax assets		9,371			7,404
Less valuation allowance		(9,371	)		(7,404	)
Net deferred tax asset (liabilities)	$	-		$	-

The Company has net operating loss carry-forwards available for future periods, as discussed below, of approximately $11,197,000 from 2019, $3,525,000 from 2018, and $1,523,000 from 2011 and prior for income tax purposes. The net operating loss carry-forwards from periods prior to 2019 expire between 2025 and 2038. Based on the change in control, which occurred in 2011, the utilization of the loss carry-forwards incurred for periods prior to 2012 is limited to approximately $160,000 per year. The Company has general business tax credits of $4,353,000 from 2015 through 2021 which expire from 2034 through 2040.

The Company continually reviews the realizability of its deferred tax assets, including an analysis of factors such as future taxable income, reversal of existing taxable temporary differences, and tax planning strategies. The Company assessed whether a valuation allowance should be recorded against its deferred tax assets based on consideration of all available evidence using a "more likely than not" standard. In assessing the need for a valuation allowance, the company considered both positive and negative evidence related to the likelihood of realization of deferred tax assets. In making such assessment, more weight was given to evidence that could be objectively verified, including recent cumulative losses. Future sources of taxable income were also considered in determining the amount of the recorded valuation allowance. Based on the Company's review of this evidence, management determined that a full valuation allowance against all of the Company's deferred tax assets was appropriate.

The following table summarizes the components of the provision for income taxes (in thousands):

	Fiscal 2021		Fiscal 2020
Current income tax expense (benefit)	$	6	$	-
Deferred income tax expense (benefit)		-		-
Total income tax expense (benefit)	$	6	$	-

Total income tax expense for the years ended September 28, 2021 and September 29, 2020 differed from the amounts computed by applying the U.S. Federal statutory tax rate to pre-tax income as follows (in thousands):

	Fiscal 2021			Fiscal 2020
Total expense (benefit) computed by applying statutory federal rate	$	3,527		$	(2,922	)
State income tax, net of federal tax benefit		260			(51	)
FICA/WOTC tax credits		(587	)		(550	)
Effect of change in tax law		(2,875	)		-
Effect of change in valuation allowance		1,967			763
Permanent differences		(2,338	)		2,510
Other		52			250
Provision for income taxes	$	6		$	-