XML 33 R17.htm IDEA: XBRL DOCUMENT
v3.20.4

Income Taxes | 12 Months Ended
--- | ---
Dec. 26, 2020
Income Tax Disclosure [Abstract] |
Income Taxes | 10. Income Taxes The provision for income taxes from continuing operations consists of the following for the fiscal years indicated: Schedule of Components of Income Tax Expense (Benefit)
|  | Fiscal Year |
|  | 2020 |  |  | 2019 |  |  | 2018 |
Current |  |  |  |  |  |  |  |  |  |  |  |
State |  | $ | — |  |  | $ | 4,000 |  |  | $ | 5,000 |
Foreign |  |  | 129,000 |  |  |  | 104,000 |  |  |  | 25,000 |
Total current provision |  |  | 129,000 |  |  |  | 108,000 |  |  |  | 30,000 |
Deferred |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | (1,075,000 | ) |  |  | (5,165,000 | ) |  |  | (7,307,000 | )
State |  |  | (321,000 | ) |  |  | (2,341,000 | ) |  |  | (360,000 | )
Foreign |  |  | (19,000 | ) |  |  | (56,000 | ) |  |  | 300,000 |
Change in valuation allowance |  |  | 1,415,000 |  |  |  | 7,562,000 |  |  |  | 7,367,000 |
Total (benefit) deferred provision |  |  | — |  |  |  | — |  |  |  | — |
Total provision for income taxes |  | $ | 129,000 |  |  | $ | 108,000 |  |  | $ | 30,000 |
The following table sets forth the changes in the Company’s balance of unrecognized tax benefits for the year ended: Schedule of Unrecognized Tax Benefit
|  | Total |
Unrecognized tax benefits at December 29, 2018 |  | $ | 394,000 |
Gross increases—prior year tax positions |  |  | — |
Gross increases—current year tax positions |  |  | - |
Unrecognized tax benefits at December 28, 2019 |  |  | 394,000 |
Unrecognized tax benefits at December 28, 2019 |  |  | 394,000 |
Gross increases—current year tax positions |  |  | — |
Unrecognized tax benefits at December 26, 2020 |  | $ | 394,000 |
U.S. GAAP requires applying a ‘more likely than not’ threshold to the recognition and derecognition of uncertain tax positions either taken or expected to be taken by the Company’s income tax returns. The total amount of our gross tax liability for tax positions that may not be sustained under a ‘more likely than not’ threshold amounts to $0.4 million as of December 26, 2020 and December 28, 2019. The Company’s policy regarding the classification of interest and penalties is to include these amounts as a component of income tax expense. The total amount of accrued interest and penalties related to the Company’s unrecognized tax benefits was $0.9 million and $0.8 million as of December 26, 2020 and December 28, 2019 respectively. Net operating losses were not utilized in 2020, 2019 and 2018 to offset federal and state taxes. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The actual income tax provision reported from operations are different than those which would have been computed by applying the federal statutory tax rate to loss before income tax provision. A reconciliation of income tax (benefit) provision from continuing operations as computed at the U.S. federal statutory income tax rate to the provision for income tax benefit is as follows: Schedule of Effective Income Tax Rate Reconciliation
|  | Fiscal Year |
|  | 2020 |  |  | 2019 |  |  | 2018 |
Tax provision at federal statutory rates |  | $ | (925,000 | ) |  | $ | (6,196,000 | ) |  | $ | (7,515,000 | )
State tax liability |  |  | — |  |  |  | 4,000 |  |  |  | 5,000 |
Foreign deferred tax rate differential |  |  | (38,000 | ) |  |  | (64,000 | ) |  |  | (39,000 | )
Foreign withholding |  |  | — |  |  |  | — |  |  |  | 301,000 |
Outside basis in Kowon, net unremitted earnings |  |  | — |  |  |  | — |  |  |  | (468,000 | )
Permanent items |  |  | 238,000 |  |  |  | 1,964,000 |  |  |  | 186,000 |
Increase in net state operating loss carryforwards |  |  | (233,000 | ) |  |  | (1,985,000 | ) |  |  | (406,000 | )
Utilization of net operating losses for U.K. research and development refund |  |  | (151,000 | ) |  |  | (148,000 | ) |  |  | — |
Provision to tax return adjustments and tax rate change |  |  | (180,000 | ) |  |  | 803,000 |  |  |  | (76,000 | )
Tax credits |  |  | 9,000 |  |  |  | (1,931,000 | ) |  |  | 239,000 |
Non-deductible 162M compensation limitations |  |  | — |  |  |  | — |  |  |  | 13,000 |
Equity compensation |  |  | (121,000 | ) |  |  | 16,000 |  |  |  | 290,000 |
Uncertain tax position for transfer pricing |  |  | 129,000 |  |  |  | 105,000 |  |  |  | 91,000 |
Other, net |  |  | (14,000 | ) |  |  | (22,000 | ) |  |  | 45,000 |
Change in valuation allowance |  |  | 1,415,000 |  |  |  | 7,562,000 |  |  |  | 7,364,000 |
Total provision |  | $ | 129,000 |  |  | $ | 108,000 |  |  | $ | 30,000 |
Pretax foreign income from continuing operations was approximately $1.0 million for the fiscal year ended 2020, $1.3 million for fiscal year ended 2019, and pretax foreign loss from continuing operations was approximately $0.7 million for fiscal year ended 2018. Deferred income taxes are provided to recognize the effect of temporary differences between tax and financial reporting. Deferred income tax assets and liabilities consist of the following: Schedule of Deferred Tax Assets and Liabilities
|  | Fiscal Year |
|  | 2020 |  |  | 2019 |
Deferred tax liability: |  |  |  |  |  |  |  |
Foreign withholding liability |  | $ | (554,000 | ) |  | $ | (525,000 | )
Deferred tax assets: |  |  |  |  |  |  |  |
Federal net operating loss carryforwards |  |  | 46,311,000 |  |  |  | 44,820,000 |
State net operating loss carryforwards |  |  | 5,454,000 |  |  |  | 5,097,000 |
Foreign net operating loss carryforwards |  |  | 1,319,000 |  |  |  | 1,293,000 |
Equity awards |  |  | 549,000 |  |  |  | 428,000 |
Tax credits |  |  | 9,153,000 |  |  |  | 9,161,000 |
Property, plant and equipment |  |  | 577,000 |  |  |  | 524,000 |
Unrealized losses on investments |  |  | 2,860,000 |  |  |  | 2,641,000 |
Other |  |  | 757,000 |  |  |  | 1,603,000 |
Net deferred tax assets |  |  | 66,426,000 |  |  |  | 65,042,000 |
Valuation allowance |  |  | (66,980,000 | ) |  |  | (65,566,000 | )
|  | $ | (554,000 | ) |  | $ | (524,000 | )
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The valuation allowance was approximately $67.0 million and $65.6 million at December 26, 2020 and December 28, 2019, respectively, primarily driven by U.S. net operating loss carryforwards (“NOLs”) and tax credits that the Company does not believe will ultimately be realized. Deferred tax assets and liabilities— As of December 26, 2020, the Company has available for tax purposes NOLs of $160.3 million expiring 2021 through 2038 and $60.1 million that have an unlimited carryover period. The Company has recognized a full valuation allowance on its net deferred tax assets as the Company has concluded that such assets are not more likely than not to be realized. The 2017 Tax Act imposes a mandatory transition tax on accumulated foreign earnings and eliminates U.S. taxes on foreign subsidiary distribution. As a result, earnings in foreign jurisdictions are available for distribution to the U.S. without incremental U.S. income taxes. Under the provisions of Section 382, certain substantial changes in Kopin’s ownership may limit in the future the amount of net operating loss carryforwards that could be used annually to offset future taxable income and income tax liability. The Company’s income tax returns have not been examined by the Internal Revenue Service and are subject to examination for all years since 2001. State income tax returns are generally subject to examination for a period of three to five years after filing of the respective return. The state impact of any federal changes remains subject to examination by various states for a period of up to one year after formal notification to the states. International jurisdictions have statutes of limitations generally ranging from three to twenty years after filing of the respective return. Years still open to examination by tax authorities in major jurisdictions include Korea (2009 onward), Japan (2009 onward), Hong Kong (2011 onward) and United Kingdom (2014 onward). The Company is not currently under examination in these jurisdictions.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration