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NOTE 13 - INCOME TAXES
 12 Months Ended
Dec. 31, 2012
Income Tax Disclosure [Text Block]
NOTE 13 - INCOME TAXES

The components of pre-tax loss for the years ended December 31, 2012 and 2011 are as follows:

   
2012
   
2011
 
Domestic
 
$
(1,867
)
 
$
(692
) 
Foreign
   
(880
) 
   
115
 
 Total
 
$
(2,747
)
   
(577
) 

The components of the provision for income taxes attributable to continuing operations for the years ended December 31, 2012 and 2011 are as follows:

   
2012
   
2011
 
Current:
           
Federal
 
$
-
   
$
-
 
State
   
10
     
1
 
Foreign
   
79
     
43
 
Total current
   
89
     
44
 
                 
Deferred:
               
Federal
   
197
     
25
 
State
   
23
     
3
 
Foreign
   
(24
) 
   
-
 
Total deferred
   
196
     
28
 
                 
   
$
285
     
72
 

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred taxes at December 31, 2012 and 2011 are as follows:

   
2012
   
2011
 
DEFERRED TAX ASSETS:
           
Current deferred tax assets
           
    Deferred revenue
 
$
858
   
$
454
 
    Accrued expenses
   
30
     
91
 
    Other
   
31
     
7
 
     
919
     
552
 
    Valuation allowance
   
(1,003
) 
   
(543
) 
  Net current deferred tax assets
   
(84
) 
   
9
 
                 
  Noncurrent deferred tax assets
               
    Net operating losses
   
40,400
     
40,718
 
 Research and development credit carryforwards
   
4,353
     
3,875
 
 Minimum tax credit carryforwards
   
161
     
161
 
    Fixed assets
   
171
     
367
 
                 
    Share based compensation
   
67
     
65
 
     
45,152
     
45,186
 
    Valuation allowance
   
(42,955
) 
   
(44,449
) 
   Net noncurrent deferred tax assets
   
2,197
     
737
 
                 
Noncurrent deferred tax liabilities
               
    Acquired intangibles
   
(2,089
)
   
(746
)
    Goodwill
   
(248
) 
   
               (28
) 
                 
Total noncurrent deferred tax liabilities
   
(2,337
)
   
(774
)
                 
  Net current deferred tax asset (liability)
   
(84
) 
   
9
 
  Net noncurrent deferred tax liability
 
$
(140
) 
 
$
(37
) 

At December 31, 2012, we had federal net operating loss carryforwards of approximately $118,135, research and development credit carryforwards of approximately $4,792 and alternative minimum tax credit carryforwards of approximately $161. The net operating loss and research and development credit carryforwards will expire in varying amounts from 2013 through 2033, if not utilized. Minimum tax credit carryforwards carry forward indefinitely.

As a result of our various acquisitions in prior years, we may be subject to a substantial annual limitation in the utilization of the net operating losses and credit carryforwards due to the “change in ownership” provisions of the Internal Revenue Code of 1986. The annual limitation may result in the expiration of net operating losses before utilization.

Due to the uncertainty surrounding the timing of realizing the benefits of its favorable tax attributes in future tax returns, we have placed a valuation allowance against our net deferred tax asset, exclusive of goodwill. During 2012, the valuation allowance decreased by approximately $3,339 due primarily to operations, including expiration of tax carryforwards. The valuation allowance also increased by approximately $2,304 in 2012 due to the acquisition of PeopleCube. Approximately $8,251 of the valuation allowance relates to tax benefits for stock option deductions included in our net operating loss carryforward which we will allocate, if and when realized, directly to contributed capital to the extent the benefits exceed amounts attributable to book deferred compensation expense.

We consider undistributed earnings of our foreign subsidiaries as permanently reinvested and, accordingly, we have made no provision for U.S. federal or state income taxes thereon.

Our provision for income taxes attributable to continuing operations differs from the expected tax expense (benefit) amount computed by applying the statutory federal income tax rate of 34% to income before income taxes as a result of the following:

 
For the Year Ended
December 31, 2012
   
For the Year Ended
December 31, 2011
 
             
Computed at statutory rate
 
$
(934
) 
 
$
(196
) 
State taxes, net of federal benefit
   
61
     
3
 
Permanent items and other
   
248
     
26
 
Credit carryforwards
   
667
     
-
 
Foreign income taxed at different rates
   
354
     
  -
 
Tax carryforwards not benefitted
   
(111
) 
   
239
 
   
$
285
   
$
72
 

In August 2007, we adopted ASC 740-10 regarding uncertain tax positions.  We did not record any additional tax liability as a result of the adoption of ASC 740-10 and no adjustment was required to the August 1, 2007 balance of retained earnings. The total amount of unrecognized tax benefits as of January 1, 2012 was approximately $1,051. The reconciliation of our unrecognized tax benefits at the beginning and end of the year is as follows:

Balance at January 1, 2012
 
$
1,051
 
Additions based on tax positions related to the current year
   
34
 
Additions for tax positions of prior years
   
110
 
Balance at December 31, 2012
 
$
1,195
 

As of December 31, 2012, we had $1,195 of unrecognized tax benefits, which would affect the effective tax rate if recognized.  

Our practice is to recognize interest and/or penalties related to income tax matters in income tax expense.  During 2012, we recognized $5 of interest and penalties in our income tax expense. 

Asure files tax returns in the U.S. federal jurisdiction and in several state and foreign jurisdictions.  We are no longer subject to U.S. federal income tax examinations for years ending before July 31, 2009 and are no longer subject to state and local or foreign income tax examinations by tax authorities for years ending before July 31, 2008.  Asure is not currently under audit for federal, state or any foreign jurisdictions.