Note 11 - Income Taxes

3 Months Ended

Apr. 30, 2024

Notes to Financial Statements

Income Tax Disclosure [Text Block]

11. Income Taxes

For the three-month period ended April 30, 2024, the income tax expense from continuing operations was approximately  $ 245,000, on pre-tax income from continuing operations of approximately $1.2 million. For the three- month period ended April 30, 2023, the income tax expense from continuing operations was approximately $ 411,000, on pre-tax income from continuing operations of  $ 287,000. The variance between our actual provision and the expected provision when applying the U.S. statutory rate of 21% is due primarily to the impact of income taxes accrued in certain foreign jurisdictions, mainly Singapore, which do not have net operating losses available to offset taxable income, and because valuation allowances have been recorded against increases in our deferred tax assets. Valuation allowances have been provided against all deferred tax assets in the United States and several foreign jurisdictions.

The Company files U.S. federal and state income tax returns as well as separate returns for its foreign subsidiaries within their local jurisdictions. The Company's U.S. federal tax returns are subject to examination by the Internal Revenue Service for fiscal years ended January 31, 2019 through 2024. The Company’s tax returns may also be subject to examination by state and local tax authorities for fiscal years ending  January 31, 2017 through 2024. The Company's Singapore income tax returns are subject to examination by the Singapore tax authorities for the fiscal years ended January 31, 2017, through 2024. The Company’s tax returns in other foreign jurisdictions are generally subject to examination for the fiscal years ended January 31, 2018 through 2024.

The Company has determined that the undistributed earnings of foreign subsidiaries are not deemed to be indefinitely reinvested outside of the United States as of April 30, 2024. Furthermore, the Company has concluded that any deferred taxes with respect to the undistributed foreign earnings would be immaterial. Therefore, the Company has not recorded a deferred tax liability associated with the undistributed foreign earnings as of April 30, 2024.

For the three-month period ended April 30, 2024 and 2023, the Company did not recognize any tax expense or benefit related to uncertain tax positions.