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Income Taxes
 12 Months Ended
Dec. 31, 2012
Income Taxes [Abstract]  
Income Taxes

Note 7 Income Taxes

The Company files a consolidated Federal income tax return. It is the policy of the Company to allocate the consolidated tax provision to subsidiaries as if each subsidiary’s tax liability or benefit were determined on a separate company basis. As part of the consolidated group, subsidiaries transfer to the Company their current Federal tax liability or assets.

 

                         
    As of December 31,  
    2012     2011     2010  

Current city income tax provision

   $ 406,814     $ 658,106     $ 514,076  

Current state income tax provision

     122,704       271,776       147,642  

Current federal income tax provision

     8,990,777       8,921,527       6,966,872  

Deferred federal income tax benefit

     (368,572 )      (1,209,928 )      (352,509 ) 
   

 

 

    

 

 

    

 

 

  

Provision for income taxes

   $ 9,151,723     $ 8,641,481     $ 7,276,081  
   

 

 

    

 

 

    

 

 

  

A reconciliation of income tax expense at the statutory federal rate to the Company’s income tax expense is as follows:

 

                         
    2012     2011     2010  

Income tax computed at statutory rate

   $ 9,128,915     $ 8,048,057     $ 6,887,483  

City and state income taxes, net of federal benefit

     344,187       604,423       430,117  

Other

     (321,379 )      (10,999 )      (41,519 ) 
   

 

 

    

 

 

    

 

 

  

Income tax expense

   $ 9,151,723     $ 8,641,481     $ 7,276,081  
   

 

 

    

 

 

    

 

 

  

In addition to the income tax expense listed above for the years ended December 31, 2012, 2011, and 2010, income tax benefit recorded in shareholders equity for the same periods was $2,026,841, $7,007, and $84,375, respectively. Included in 2012 is $1,992,298 which relates to tax benefits not previously claimed by the Company. The Company plans to claim these deductions in future tax returns.

Deferred tax assets and liabilities consist of the following at December 31, 2012 and 2011:

 

                 
    2012     2011  

Stock-based compensation

   $ 3,289,885     $ 2,629,271  

Unrealized (gains) losses

     (763,235 )      (441,092 ) 

Other assets and liabilities

     (74,676 )      (104,777 ) 
   

 

 

    

 

 

  

Net deferred tax assets

   $ 2,451,974     $ 2,083,402  
   

 

 

    

 

 

  

The net temporary differences incurred to date will reverse in future periods as the Company generates taxable earnings. The Company believes it is more likely than not that the results of future operations will generate sufficient taxable income to realize the net deferred tax assets recorded. The Company records a valuation when it is more likely than not that some portion of all of the deferred tax assets will not be realized. As of December 31, 2012, no valuation allowance was deemed necessary.

FASB ASC 740, Income Taxes, prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return and also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company did not record an accrual for tax related uncertainties or unrecognized tax positions as of December 31, 2012. The Company does not expect a change to the reserve for uncertain tax positions within the next twelve months that would have a material impact on the consolidation financial statements.

The Company files income tax returns in the federal and all applicable state and local jurisdictions. The Company is subject to federal, state and local examinations by tax authorities for tax years ended December 31, 2009 through 2012.