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Income Taxes | 12 Months Ended
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Dec. 31, 2012
Income Taxes [Abstract] |
Income Taxes | 9. Income Taxes The components of current and deferred income tax expense included in the Consolidated Statement of Operations as determined in accordance with ASC 740, Income Taxes (“ASC 740”), are as follows:
Current: |  |  |  |
Federal |  | $ | — |
State and local |  |  | — |
|  |  | — |
Deferred: |  |  |  |
Federal |  |  | — |
State and local |  |  | — |
|  |  | — |
Income tax expense from operations |  | $ | — |
The Company has recorded its non-income based taxes as part of other liabilities and other expenses. At December 31, 2012 and 2011, the Company had total net operating losses carry forwards of $136,515 and $106,939, respectively. Due to an ownership change on November 10, 2004, this carry forward includes a Section 382 (of the U.S. Internal Revenue Code) limited net operating loss of approximately $14,049 at December 31, 2012, which expires at various dates through 2024, and the annual utilization of which is limited to $524 in future years. In 2012, $3,487 of these losses have been deemed to be worthless and written off. The NOLs before the writeoff will expire as follows:
Year Ending December 31: |  |  |  |
2018 |  | $ | 5,819 |
2019 |  |  | 5,101 |
2021 |  |  | 579 |
2023 |  |  | 608 |
2024 |  |  | 1,942 |
|  | $ | 14,049 |
The Company has determined that a second Section 382 change in ownership occurred on November 12, 2012. Accordingly, the NOLs incurred between the two ownership changes (detailed below) are also subject to an annual limit as currently estimated of $58,888. Approximately $4,300 of the 2012 losses are allocable to the post change period and therefore not subject to limitation.
Year Ending December 31: |  |  |  |
2024 |  | $ | 388 |
2025 |  |  | 3,239 |
2026 |  |  | 15,560 |
2027 |  |  | 24,655 |
2028 |  |  | 19,754 |
2029 |  |  | 14,218 |
2030 |  |  | 6,385 |
2031 |  |  | 6,052 |
2032 |  |  | 32,215 |
|  | $ | 122,466 |
At December 31, 2012 and 2011, the composition of the deferred tax asset is summarized as follows by applying a 45.22% and 45.13% tax rate to the deferred tax items:
|  | December 31, |
|  | 2012 |  |  | 2011 |
Deferred tax assets: |  |  |  |  |  |  |  |
Net operating losses |  | $ | 37,571 |  |  | $ | 39,977 |
Stock-based compensation |  |  | 6,471 |  |  |  | 8,998 |
Fixed assets |  |  | 286 |  |  |  | 236 |
Deferred rent liability |  |  | 68 |  |  |  | 132 |
Other |  |  | 82 |  |  |  | 79 |
Total deferred tax assets |  |  | 44,478 |  |  |  | 49,422 |
Less: valuation allowance |  |  | (44,478 | ) |  |  | (49,422 | )
Net deferred tax assets |  | $ | — |  |  | $ | — |
$49,946 of the available NOLs (total NOLs excluding those written off) has been generated from excess stock compensation deductions that cannot be recognized under ASC 718. Accordingly, a deferred tax asset related to this amount has not been set up. At December 31, 2012 and 2011, the deferred tax asset has been offset by a valuation allowance of $44,478 and $49,422 respectively. A reconciliation between the statutory federal income tax rate of 35% and the Company’s effective rate is as follows:
|  | December 31, |
|  | 2012 |  |  | 2011 |  |  | 2010 |
Federal statutory rate |  |  | 35.00 | % |  |  | 35.00 | % |  |  | (35.00 | %)
Permanent differences |  |  | (119.37 | %) |  |  | (105.65 | %) |  |  | 2.02 | %
State income tax rate, net of federal benefit |  |  | 9.44 | % |  |  | 21.28 | % |  |  | (0.33 | %)
(Decrease)/increase in valuation allowance |  |  | (44.82 | %) |  |  | (89.25 | %) |  |  | 5.59 | %
Worthless Net Operating Losses per Section 382 |  |  | 0.00 | % |  |  | 0.00 | % |  |  | 32.89 | %
Change in effective rate |  |  | 0.00 | % |  |  | 0.00 | % |  |  | 7.85 | %
NOL adjustment |  |  | 119.74 | % |  |  | 138.22 | % |  |  | 0.00 | %
Other differences, net |  |  | 0.01 | % |  |  | 0.40 | % |  |  | (13.02 | %)
Effective rate |  |  | 0.00 | % |  |  | 0.00 | % |  |  | 0.00 | %
As of December 31, 2012, the Company determined that it has no uncertain tax positions, interest or penalties as defined within ASC 740-10. The Company does not have unrecognized tax benefits. The Company does not believe that it is reasonably possible that the total unrecognized benefits will significantly increase within the next 12 months. The Company is not currently under audit by any taxing authority. Tax returns filed with each jurisdiction remain open to examination under the normal three-year statute of limitations.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 136, 172 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph h -Article 4 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 43, 44, 45, 46, 47, 48, 49 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32537-109319 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32559-109319 + Details
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