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Income Taxes | 12 Months Ended
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Dec. 31, 2019
Income Tax Disclosure [Abstract] |
Income Taxes | NOTE 13 INCOME TAXES The components of income (loss) before income tax expense (benefit) by jurisdiction for continuing operations for the years ended December 31, consisted of the following (in thousands):
|  | 2019 |  |  | 2018 |
United States |  |  | 4,120 |  |  |  | (857 | )
Canada |  |  | (735 | ) |  |  | (138 | )
United Kingdom |  |  | (184 | ) |  |  | (210 | )
Poland |  |  | (312 | ) |  |  | (805 | )
Total income (loss) before tax expense (benefit) |  | $ | 2,889 |  |  | $ | (2,010 | )
The components of current and deferred federal and state income tax expense (benefit) expense for continuing operations for the years ended December 31, consisted of the following (in thousands):
|  | 2019 |  |  | 2018 |
Federal income tax expense (benefit) - deferred |  |  | 5 |  |  |  | (1,171 | )
State income tax expense - current |  |  | 153 |  |  |  | 173 |
State income tax (benefit) expense - deferred |  |  | (1 | ) |  |  | 62 |
Total income tax expense (benefit) |  | $ | 157 |  |  | $ | (936 | )
An overall reconciliation between the expected tax expense (benefit) using the federal statutory rate of 21% for each of the years ended 2019 and 2018 and the expense (benefit) for income taxes from continuing operations as reported in the accompanying Consolidated Statement of Operations is provided below (in thousands).
|  | 2019 |  |  | 2018 |
Federal tax expense (benefit) at statutory rate |  | $ | 607 |  |  | $ | (392 | )
State tax expense (benefit), net of federal benefit |  |  | 152 |  |  |  | (178 | )
Change in deferred tax rates |  |  | 106 |  |  |  | (78 | )
Permanent items |  |  | 54 |  |  |  | (388 | )
Difference in foreign rate |  |  | (27 | ) |  |  | 13 |
Change in deferred tax liabilities |  |  | 835 |  |  |  | 114 |
Other |  |  | (218 | ) |  |  | (99 | )
(Decrease) increase in valuation allowance |  |  | (1,352 | ) |  |  | 72 |
Income tax expense (benefit) |  | $ | 157 |  |  | $ | (936 | )
A provision of the Tax Cuts and Jobs Act of 2017 (the “TCJA”) which was signed into law in December 2017 provides an indefinite carryforward period for net operating losses (“NOLs”) generated starting in 2018. Also, the law limits the utilization of these NOLs to 80% of taxable income in the year in which the NOL is utilized. The Company had been carrying on its balance sheet a deferred tax liability related to indefinite-lived intangible assets. A common accounting interpretation of the TCJA provisions is that deferred tax assets related to indefinite-lived NOLs may be used to offset indefinite-lived deferred tax liabilities, up to 80% of the amount of the liability. During 2018, the Company forecasted a substantial tax loss for the full year due to the closure of the M&EC facility. As a result, the Company released a portion of the valuation allowance against deferred tax assets equal to 80% of the deferred tax liability related to indefinite-lived intangible assets and recorded a tax benefit in the amount of approximately $1,235,000 in accordance to the provisions of the TCJA. The global intangible low-taxed income (“GILTI”) provisions under the TCJA require the Company to include in its U.S. income tax return foreign subsidiary earnings in excess of an allowable return on the foreign subsidiary’s tangible assets. The Company has elected to account for GILTI tax in the period in which it is incurred, and therefore has not provided any deferred tax impacts of GILTI in its consolidated financial statements for the years ended December 31, 2019 and 2018. As the foreign subsidiaries are all in loss positions for 2019, there is no GILTI inclusion for the current year. The base-erosion and anti-abuse tax provisions (“BEAT”) in the TCJA eliminates the deduction of certain base-erosion payments made to related foreign corporations, and imposes a minimum tax if greater than regular tax. The Company does not expect it will be subject to this tax due to the immaterial amounts of outbound U.S. payments and therefore has not included any tax impacts of BEAT in its consolidated financial statements for the years ended December 31, 2019 and 2018. The Company had temporary differences and net operating loss carry forwards from both our continuing and discontinued operations, which gave rise to deferred tax assets and liabilities at December 31, 2019 and 2018 as follows (in thousands):
|  | 2019 |  |  | 2018 |
Deferred tax assets: |  |  |  |  |  |
Net operating losses |  | $ | 9,391 |  |  | $ | 9,540 |
Environmental and closure reserves |  |  | 1,977 |  |  |  | 2,124 |
Lease liability |  |  | 742 |  |  |  | — |
Other |  |  | 1,295 |  |  |  | 1,263 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Depreciation and amortization |  |  | (3,211 | ) |  |  | (2,418 | )
Goodwill and indefinite lived intangible assets |  |  | (590 | ) |  |  | (586 | )
Right-of-use lease asset |  |  | (730 | ) |  |  | — |
481(a) adjustment |  |  | (336 | ) |  |  | — |
Prepaid expenses |  |  | (22 | ) |  |  | (30 | )
|  |  | 8,516 |  |  |  | 9,893 |
Valuation allowance |  |  | (9,106 | ) |  |  | (10,479 | )
Net deferred income tax liabilities |  |  | (590 | ) |  |  | (586 | )
In 2019 and 2018, the Company concluded that it was more likely than not that $9,106,000 and $10,479,000 of our deferred income tax assets would not be realized, and as such, a full valuation allowance was applied against those deferred income tax assets. The Company has estimated net operating loss carryforwards (“NOLs”) for federal and state income tax purposes of approximately $20,548,000 and $57,809,000, respectively, as of December 31, 2019. The estimated consolidated federal and state NOLs include approximately $2,410,000 and $3,763,000, respectively, of our majority-owned subsidiary, PF Medical, which is not part of our consolidated group for tax purposes. These net operating losses can be carried forward and applied against future taxable income, if any, and expire in various amounts starting in 2021. Approximately $12,199,000 of our federal NOLs were generated after December 31, and thus do not expire. However, as a result of various stock offerings and certain acquisitions, which in the aggregate constitute a change in control, the use of these NOLs will be limited under the provisions of Section 382 of the Internal Revenue Code of 1986, as amended. Additionally, NOLs may be further limited under the provisions of Treasury Regulation 1.1502-21 regarding Separate Return Limitation Years. The tax years 2017 through 2019 remain open to examination by taxing authorities in the jurisdictions in which the Company operates. No uncertain tax positions were identified by the Company for the years currently open under statute of limitations, including 2019 and 2018. The Company had no federal income tax payable for the years ended December 31, 2019 and 2018.

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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