5. Income Taxes

The Company had a provision for income taxes for the three months ended March 31, 2015 and 2014 that consisted of the following (in thousands):


	Three Months Ended
	March 31,
	2015		2014
Current:
Federal	$	—	$	—
State		6		4

Total		6		4
Deferred:
Federal		—		2
State		—		—

Total		—		2
Total:
Federal		—		2
State		6		4

Total	$	6	$	6

The Company annually evaluates the positive and negative evidence bearing upon the realizability of its deferred tax assets. The Company, however, has considered results of current operations and concluded that it is more likely than not that the deferred tax assets will not be realizable. As a result, the Company has determined that a valuation allowance of $37.9 million and $38.2 million is required at March 31, 2015, and December 31, 2014, respectively. The tax effects of temporary differences that gave rise to deferred tax assets at March 31, 2015, and December 31, 2014, were as follows (in thousands):


	March 31,			December 31,
	2015			2014
Deferred tax assets:
Net operating losses	$	42,277		$	42,579
Capital losses		361			361
Accrued expenses		22			18

Total deferred tax assets		42,660			42,958
Valuation allowance		(37,860	)		(38,166	)

		4,800			4,792
Deferred tax liabilities:
State deferreds		(4,822	)		(4,814	)
Other investment		22			22

Total deferred tax liabilities		(4,800	)		(4,792	)

Net deferred taxes	$	—		$	—

As of March 31, 2015, the Company had federal NOLs totaling approximately $84.1 million and post-apportionment state NOLs totaling approximately $154.3 million. The New York State post-apportionment NOLs included above total $122.7 million. The federal NOLs carry forward for 20 years and being to expire in 2021 through 2036. The state post-apportioned NOLs are from various states and begin to expire in 2015 through 2036.

The Company also has pre-apportionment NOLs from New York City totaling $113.9 million as of March 31, 2015. Since the Company has no revenue-generating operations in New York City and none are expected in the future, management has determined that none of the NOLs should be recognized. If the Company were to commence operations in New York City in future years, the realizability of the NOLs and related deferred tax assets will be assessed at such time. The NOLs from New York City carry forward for 20 years and begin to expire in 2021 through 2036.

The federal and state NOLs may be subject to certain limitations under Section 382 of the Internal Revenue Code, which could significantly restrict the Company’s ability to use the NOLs to offset taxable income in subsequent years. The Company completed a review of any potential limitation on the use of its net operating losses under Section 382 on August 9, 2008, and an update to this review on June 7, 2013. Based on such reviews, the Company does not believe Section 382 of the Internal Revenue Code will adversely impact its ability to use its current net operating losses to offset future taxable income, if any.

The following is a reconciliation of the statutory federal income tax rate to the actual effective income tax rate:


	March 31,
	2015			2014
Federal tax (benefit) rate		(34.0	)%		(34.0	)%
Increase (decrease) in taxes resulting from:
State income taxes		(5.8	)		(5.8	)
Change in valuation allowance		38.2			39.5
Permanent differences		1.6			0.3
Minimum tax		2.4			0.6

		2.4	%		0.6	%