Note 11 - Income Taxes

12 Months Ended

Dec. 31, 2013

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

11.     Income Taxes

The provision for income taxes consists of the following (in thousands):

	Year Ended December 31,
	2013			2012
Income (loss) before income taxes:
United States	$	3,194		$	(8,288	)
Foreign		305			(99	)
	$	3,499			(8,387	)
Current income tax benefit from operations:
Federal	$	--		$	--
Foreign		--			--
State		--			--
	$	--		$	--
Deferred income tax benefit/(provision) from operations:
Federal	$	1,380			2,444
Foreign		(142	)		(104	)
State		172			(1,437	)
		1,410			903
Change in valuation allowance		(1,410	)		(903	)
Total provision for income taxes	$	—		$	—

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets as of December 31 are as follows (in thousands):

	2013			2012
Net federal and state operating loss carryforwards	$	22,939		$	24,689
Net foreign operating loss carryforwards		523			380
Accrued expenses and reserves		(2	)		--
Tax credits		1,212			1,194
Other		476			295
Total deferred tax assets		25,148			26,558
Valuation allowance		(25,148	)		(26,558	)
Net deferred tax assets	$	-		$	-

The valuation allowance decreased by $1,410,000 in 2013 primarily due to the Company’s net income. The Company recorded the valuation allowance due to the uncertainty of the realizability of the related net deferred tax asset.

Total provision for income taxes computed at the federal statutory rate differs from amounts provided as follows (in thousands):

	2013			2012
Tax provision (benefit) at federal statutory rate		1,061		$	(2,818	)
State income taxes, net of U.S. federal income tax provision (benefit)		4			(11	)
Permanent differences		46			17
Other		299			1,909
Change in valuation allowance		(1,410	)		(903	)
Total expense	$	--		$	--

At December 31, 2013, the Company had federal net operating loss carryforwards available to reduce future taxable income of approximately $67,207,600 which expire at various dates through 2032. At December 31, 2013, the Company had federal and state research and development credit carryforwards of $752,000 and $460,000, respectively, which will expire at various dates through 2032 for federal income tax purposes and through 2027 for state income tax purposes. In addition, at December 31, 2013 the Company had foreign net operating loss carryforwards of approximately $752,000.

Under the Internal Revenue Code of 1986, as amended, certain substantial changes in the Company’s ownership may limit the amount of net operating loss carryforwards that can be utilized in any one year to offset future taxable income. Any carryforwards that will expire prior to utilization as the result of any limitations will be removed from deferred tax assets with a corresponding reduction of the valuation allowance. Due to the existence of the valuation allowance, future changes in the Company’s unrecognized tax benefits will not impact its effective tax rate.

The Company recognizes a tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities. As of December 31, 2013 and 2012, there were no unrecognized tax benefits. The Company’s policy is to record estimated interest and penalties related to the underpayment of income taxes as a component of its income tax provision. As of December 31, 2013 and 2012, the Company had no accrued interest or tax penalties recorded.

The Company files income tax returns in the U.S. federal jurisdiction and in several state and foreign jurisdictions. For U.S. federal and state tax purposes, the tax years 2007 through 2013 remain open to examination. In addition, the amount of the Company’s federal and state net operating loss carryforwards may be subject to examination and adjustment. The open examination periods for the Company’s foreign jurisdictions range from 2000 through 2009.