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Income Tax | 12 Months Ended
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Dec. 31, 2016
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes Income (loss) from continuing operations before income taxes consisted of the following:
| (Dollars in thousands)
| Year Ended December 31,
| 2016 |  | 2015 |  | 2014
United States | $ | (708 | ) |  | $ | 3,583 |  |  | $ | (4,355 | )
Canada | (823 | ) |  | (2,431 | ) |  | (1,479 | )
| $ | (1,531 | ) |  | $ | 1,152 |  |  | $ | (5,834 | )
Provision (benefit) for income taxes from continuing operations for the years ended December 31, consisted of the following:
| (Dollars in thousands)
| Year Ended December 31,
| 2016 |  | 2015 |  | 2014
Current income tax expense (benefit): |  |  |  |  |
U.S. Federal | $ | 97 |  |  | $ | (461 | ) |  | $ | (377 | )
U.S. state | (33 | ) |  | 75 |  |  | 79 |
Canada | 3 |  |  | 1,241 |  |  | 525 |
Total | $ | 67 |  |  | $ | 855 |  |  | $ | 227 |
Deferred income tax expense: |  |  |  |  |
U.S. Federal | — |  |  | — |  |  | — |
U.S. state | 31 |  |  | — |  |  | — |
Canada | — |  |  | — |  |  | — |
Total | 31 |  |  | — |  |  | — |
Total income tax expense (benefit): |  |  |  |  |
U.S. Federal | 97 |  |  | (461 | ) |  | (377 | )
U.S. state | (2 | ) |  | 75 |  |  | 79 |
Canada | 3 |  |  | 1,241 |  |  | 525 |
Total | 98 |  |  | 855 |  |  | 227 |
The reconciliation between the effective income tax rate and the statutory federal rate for continuing operations was as follows:
| Year Ended December 31,
| 2016 |  | 2015 |  | 2014
Statutory Federal rate | 35.0% |  |  | 35.0 | % |  | 35.0% |
Increase (decrease) resulting from: |  |  |  |  |
State and local taxes, net | (17.4 | ) |  | 10.4 |  |  | 2.8 |
Change in valuation allowance | 14.5 |  |  | (86.4 | ) |  | (26.9 | )
Foreign tax rate differential | (14.3 | ) |  | 17.9 |  |  | (2.2 | )
Meals & entertainment | (9.0 | ) |  | 11.6 |  |  | (2.6 | )
Alternative minimum tax | (6.3 | ) |  | 7.6 |  |  | — |
Provision to return differences | (4.5 | ) |  | 24.4 |  |  | (3.2 | )
Executive life insurance | (3.1 | ) |  | 2.4 |  |  | 2.3 |
Captive insurance income | (3.0 | ) |  | — |  |  | — |
Change in uncertain tax positions | 0.6 |  |  | 56.2 |  |  | (9.0 | )
Other items, net | 1.1 |  |  | (4.9 | ) |  | (0.1 | )
Provision for income taxes | (6.4 | )% |  | 74.2 | % |  | (3.9 | )%
The Company paid income taxes of $0.2 million, $0.1 million and $0.2 million in the years ended December 31, 2016, 2015, and 2014, respectively. At December 31, 2016, the Company had $46.7 million of U.S. Federal net operating loss carryforwards which are subject to expiration beginning in 2030, and $0.5 million of foreign tax credit carryforwards which are subject to expiration beginning in 2020. In addition, the Company had $37.5 million of various state net operating loss carryforwards which expire at varying dates through 2034. Primarily due to the cumulative losses incurred in recent years, management determined that it was more likely than not that the Company will not be able to utilize its deferred tax assets to offset future taxable income. In 2016, 2015 and 2014 the Company decreased its deferred tax valuation allowance by $1.1 million, $0.2 million and $0.8 million, respectively. The tax valuation allowance will remain until the Company can establish that the recoverability of its deferred tax assets is more likely than not. As a result of acquisitions completed in 2016 and 2015, the Company recorded $5.5 million of tax deductible goodwill that may result in a tax benefit in future periods. Deferred income tax assets and liabilities contain the following temporary differences:
| (Dollars in thousands)
| December 31,
| 2016 |  | 2015
Deferred tax assets: |  |  |
Net operating loss carryforward | $ | 17,518 |  |  | $ | 19,336 |
Compensation and benefits | 12,126 |  |  | 11,979 |
Inventory reserve | 2,750 |  |  | 2,726 |
Capital loss carryforward | 2,210 |  |  | 2,210 |
Accounts receivable reserve | 183 |  |  | 218 |
Other | 1,770 |  |  | 2,073 |
Total deferred tax assets | 36,557 |  |  | 38,542 |
Deferred tax liabilities: |  |  |
Property, plant and equipment | 433 |  |  | 1,100 |
Other | 688 |  |  | 875 |
Total deferred liabilities | 1,121 |  |  | 1,975 |
Net deferred tax assets before valuation allowance | 35,436 |  |  | 36,567 |
Valuation allowance | (35,416 | ) |  | (36,516 | )
Net deferred tax assets | $ | 20 |  |  | $ | 51 |
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
| (Dollars in thousands)
| December 31,
| 2016 |  | 2015
Balance at beginning of year | $ | 3,136 |  |  | $ | 2,964 |
Additions for tax positions of current year | 544 |  |  | 146 |
Additions for tax positions of prior years | 116 |  |  | 26 |
Reductions for tax positions of prior year | (547 | ) |  | — |
Balance at end of year | $ | 3,249 |  |  | $ | 3,136 |
The recognition of the unrecognized tax benefits would have a favorable effect on the effective tax rate. Due to the uncertainty of both timing and resolution of income tax examinations, the Company is unable to determine whether any amounts included in the December 31, 2016 balance of unrecognized tax benefits represent tax positions that could significantly change during the next twelve months. Interest and penalties related to unrecognized tax benefits are recorded as a component of income tax expense. The Company and its subsidiaries are subject to U.S. Federal income tax as well as income tax of multiple state and foreign jurisdictions. As of December 31, 2016, the Company was subject to U.S Federal income tax examinations for the years 2013 through 2015 and income tax examinations from various other jurisdictions for the years 2011 through 2015. The Company was subject to an examination by the Canada Revenue Authority ("CRA") for the years 2006 through 2010. The CRA examination was completed during May 2013 and resulted in proposed adjustments which amount to $1.3 million of additional tax for the 2008 and 2009 tax years. The Company did not agree with these adjustments and filed a request with Competent Authority programs in both the U.S. and Canada in October, 2013. The Competent Authority program assists taxpayers with respect to matters covered in the mutual agreement procedure provisions of tax treaties. In the fourth quarter of 2015, Competent Authority completed their review and communicated to the Company that they proposed to assess a tax on the 2009 tax year only. A formal Letter of Disposition from Competent Authority was received in April 2016. The Company has accepted the proposal and recorded an expense in 2015 of approximately $0.8 million in Canada and a related benefit of $0.5 million in the U.S.

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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 Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: 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=65882285&loc=d3e32559-109319 Reference 3: 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=65882285&loc=d3e32718-109319 Reference 4: 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=65882285&loc=d3e32639-109319 Reference 5: 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=65882285&loc=d3e32537-109319 + Details
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