TAXES (Tables)

12 Months Ended

Dec. 31, 2018

Schedule of Components of Income Tax Expense (Benefit)

A breakdown of our income tax expense (benefit) for the years ended December 31 is as follows:


($ in thousands)		2018		2017
Federal:
Current	$	2,449	$	3,387
Deferred		475		(3,765)
Total Federal		2,924		(378)

State & local:
Current		205		65
Deferred		142		125
Total State & local		347		190

Foreign
Current		75		(37)
Deferred		-		-
Total Foreign		75		(37)

Total	$	3,346	$	(225)

Reconciliation of Federal Income Tax Expense

A reconciliation of recorded Federal income tax expense to the expected expense computed by applying the applicable Federal statutory rate for all periods to income before income taxes follows:



		Years Ended December 31,
($ in thousands)		2018		2017
Expected expense at statutory rate (21% in 2018, 35% in 2017)	$	3,766	$	3,272

Increase (decrease) in income taxes resulting from:
Change in Statutory Tax Rate		-		(4,491)
Toll tax on CFC accumulated earnings and profits		(561)		2,793
Exempt income from Dominican Republic operations due to tax holiday		(1,005)		(1,802)
GILTI tax		515		-
Impact of Canadian deemed dividend		-		-
State and local income taxes		313		138
Section 199 manufacturing deduction		-		(260)
Meals and entertainment		43		80
Nondeductible penalties		1		-
Provision to return filing adjustments and other		274		45
Total	$	3,346	$	(225)

Schedule of Deferred Tax Assets and Liabilities

Deferred income taxes recorded in the Consolidated Balance Sheets at December 31, 2018 and 2017 consist of the following:


($ in thousands)		2018		2017
Deferred tax assets:
Asset reserves and accrued expenses	$	805		125
Inventories		508	$	333
State and local income taxes		238		208
Pension and deferred compensation		37		32
Net operating losses		424		581
Total deferred tax assets		2,012		1,279
Valuation allowances		(421)		(480)
Total deferred tax assets		1,591		799

Deferred tax liabilities:
Asset reserves and accrued expenses		-		-
Fixed assets		1,509		1,148
Intangible assets		6,883		6,917
Other assets		213		232
Tollgate tax on Lifestyle earnings		228		228
State and local income taxes		538		-
Total deferred tax liabilities		9,371		8,525

Net deferred tax liability	$	7,780	$	7,726

Schedule of Income Tax Examinations

We are subject to tax examinations in various taxing jurisdictions. The earliest exam years open for examination are as follows:


		Earliest Exam Year
Taxing Authority Jurisdiction:
U.S. Federal		2015
Various U.S. States		2014
Puerto Rico (U.S. Territory)		2013
Canada		2013