Income Taxes (Tables)

12 Months Ended

Dec. 31, 2012

Components of Income Before Income Taxes and Provision for (Benefit from) Income Taxes

The components of the Company’s income before income taxes and our provision for (benefit from) income taxes consist of the following:

	Year ended December 31,
	2012			2011			2010
Income (loss) before income taxes
Domestic	$	26,170,313		$	15,962,992		$	11,944,795
Foreign		(6,642,892	)		(2,177,978	)		(4,601,729	)
	$	19,527,421		$	13,785,014		$	7,343,066
	Year ended December 31,
		2012			2011			2010
Provision for (benefit from) income taxes:
Current provision:
Federal	$	7,594,287		$	3,327,626		$	1,063,841
State		885,958			155,855			(6,920	)
Foreign		(188,650	)		90,626			-
		8,291,595			3,574,107			1,056,921
Deferred provision:
Federal		776,486			1,907,408			2,828,029
State		602,447			570,869			479,529
Foreign		(1,900,567	)		(734,050	)		(1,337,408	)
		(521,634	)		1,744,227			1,970,150
Total provision	$	7,769,961		$	5,318,334		$	3,027,071

Significant Components of the Company's Deferred Tax Assets and Liabilities

Deferred Tax Assets and Liabilities

Significant components of the Company’s deferred tax assets and liabilities consist of the following:

	December 31,
	2012			2011
Deferred tax assets:
Deferred revenue	$	1,988,509		$	2,072,931
Stock-based compensation expense		1,584,583			1,496,910
Tax credit carry forward		194,364			695,914
Net operating loss carryforward, foreign		2,520,746			1,839,924
Accrued expenses and other		954,559			825,884
Inventory reserve		405,302			417,726
Deferred tax asset	$	7,648,063		$	7,349,289
	December 31,
		2012			2011
Deferred tax liabilities:
Intangibles related to Srl acquisition	$	(6,482,404	)	$	(7,594,729	)
Depreciation		(6,131,473	)		(5,210,775	)
Deferred tax liability	$	(12,613,877	)	$	(12,805,504	)

Reconciliation Between U.S. Federal Statutory Rate and Effective Rate

The reconciliation between the U.S. federal statutory rate and our effective rate is summarized as follows:

	Year ended December 31,
	2012		2011		2010
Statutory federal income tax rate	35.0	%	34.0	%	34.0	%
State tax expense, net of federal benefit	6.4	%	5.7	%	7.8	%
Permanent items, including nondeductible expenses	0.9	%	0.9	%	2.2	%
State investment tax credit	(0.2	)%	(0.2	)%	(0.8	)%
Federal, state and foreign research and development credits	(1.2	)%	(0.4	)%	(2.5	)%
Foreign rate differential	2.5	%	0.9	%	2.6	%
Domestic production deduction	(3.6	)%	(2.3	)%	(2.1	)%
Effective income tax rate	39.8	%	38.6	%	41.2	%

Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of our unrecognized tax benefits is summarized as follows:

	Year ended December 31,
	2012			2011			2010
Unrecognized tax benefit, beginning of year	$	56,170		$	37,428		$	40,900
Tax positions related to current year		-			38,329			-
Tax positions related to prior years		38,329			(19,587	)		37,427
Settlements		-			-			(3,089	)
Statute expirations		(38,329	)		-			(37,810	)
Unrecognized tax benefit, end of year	$	56,170		$	56,170		$	37,428