Note M - Income Taxes

6 Months Ended

Jun. 30, 2011

Income Tax Disclosure [Text Block]

Note M:                      Income Taxes

The Company’s effective tax rates of 49.2% and 50% for the six month periods ended June 30, 2011 and 2010, respectively, differ from the statutory federal tax rate due primarily to state taxes, stock-based compensation, differences between U.S. and foreign tax rates, foreign losses incurred with no related tax benefit, changes in state rate rates, and non-deductible meals and entertainment expenses.

Fuel Tech had unrecognized tax benefits as of December 31, 2010 in the amount of $870 all of which, if ultimately recognized, will reduce Fuel Tech’s annual effective tax rate.  There have been no material changes in unrecognized tax benefits during the three and six month periods ended June 30, 2011.