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Income Taxes | 12 Months Ended
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Jun. 30, 2014
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes We file a consolidated federal income tax return in the United States and various combined and separate filings in several state and local jurisdictions. There were no unrecognized tax benefits nor any accrued interest or penalties associated with unrecognized tax benefits during the years ended June 30, 2014, 2013 and 2012. We believe that we have appropriate support for the income tax positions taken and to be taken on the Company's tax returns and that the accruals for tax liabilities are adequate for all open years based on our assessment of many factors including past experience and interpretations of tax law applied to the facts of each matter. The Company's tax returns are open to audit under the statute of limitations for the years ending June 30, 2010 through June 30, 2013 for federal tax purposes and for the years ended June 30, 2010 through June 30, 2013 for state tax purposes. The components of our income tax provision (benefit) are as follows:
| June 30, 2014 |  | June 30, 2013 |  | June 30, 2012
Current: |  |  |  |  |
Federal | $ | 386,018 |  |  | $ | 857,480 |  |  | $ | 309,632 |
State | 161,168 |  |  | 659,303 |  |  | 841,698 |
Total current income tax provision | 547,186 |  |  | 1,516,783 |  |  | 1,151,330 |
Deferred: |  |  |  |  |
Federal | 1,319,727 |  |  | 2,546,495 |  |  | 2,542,662 |
State | 25,085 |  |  | (33,517 | ) |  | 6,930 |
Total deferred income tax provision | 1,344,812 |  |  | 2,512,978 |  |  | 2,549,592 |
Total income tax provision | $ | 1,891,998 |  |  | $ | 4,029,761 |  |  | $ | 3,700,922 |
The following table presents the reconciliation of our income taxes calculated at the statutory federal tax rate, currently 34%, to the income tax provision in our financial statements. The effective tax rate for all years is in excess of the statutory rate as a result of state income taxes, primarily in the state of Louisiana, with smaller adjustments related to stock-based compensation and other permanent differences.
| June 30, 2014 |  | June 30, 2013 |  | June 30, 2012
Income tax provision (benefit) computed at the statutory federal rate: | $ | 1,866,366 |  |  | $ | 3,623,784 |  |  | $ | 3,003,238 |
Reconciling items: |  |  |  |  |
State income taxes, net of federal tax benefit | 189,081 |  |  | 413,019 |  |  | 560,095 |
Permanent differences related to stock-based compensation | (155,817 | ) |  | 8,933 |  |  | 83,115 |
Expiring NOLs related to 2004 reverse merger | — |  |  | 600,964 |  |  | 4,348,495 |
Deferred tax asset valuation adjustment | — |  |  | (600,964 | ) |  | (4,348,495 | )
Other permanent differences | (7,632 | ) |  | (15,975 | ) |  | 54,474 |
Income tax provision | $ | 1,891,998 |  |  | $ | 4,029,761 |  |  | $ | 3,700,922 |
Deferred income taxes primarily represent the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Deferred tax assets and liabilities are classified as either current or noncurrent on the balance sheet based on the classification of the related asset or liability for financial reporting purposes. Deferred tax assets and liabilities not related to specific assets or liabilities on the financial statements are classified according the expected reversal date of the temporary difference or the expected utilization date for tax attribute carryforwards. The change in the NOL is primarily due to expiring NOLs related to the 2004 reverse merger as well as utilization of NOL to offset potential current year taxable income. The components of our deferred taxes are detailed in the table below:
| June 30, 2014 |  | June 30, 2013 |  | June 30, 2012
Deferred tax assets: |  |  |  |  |
Non-qualified stock-based compensation | $ | 134,469 |  |  | $ | 774,673 |  |  | $ | 774,720 |
Net operating loss carry-forwards | 427,249 |  |  | 427,249 |  |  | 1,336,769 |
AMT credit carry-forward* | 701,254 |  |  | 502,466 |  |  | 714,571 |
Other | 165,775 |  |  | 28,170 |  |  | 29,929 |
Gross deferred tax assets | 1,428,747 |  |  | 1,732,558 |  |  | 2,855,989 |
Valuation allowance | (292,446 | ) |  | (292,446 | ) |  | (893,410 | )
Total deferred tax assets | 1,136,301 |  |  | 1,440,112 |  |  | 1,962,579 |
Deferred tax liability: |  |  |  |  |
Oil and natural gas properties | (10,873,949 | ) |  | (9,832,948 | ) |  | (7,842,437 | )
Total deferred tax liability | (10,873,949 | ) |  | (9,832,948 | ) |  | (7,842,437 | )
Net deferred tax liability | $ | (9,737,648 | ) |  | $ | (8,392,836 | ) |  | $ | (5,879,858 | )
_______________________________________________________________________________
* | Total AMT credit carry-forward is $824,087. Our net deferred tax liability does not include $122,833 of AMT credit carry-forward associated with the tax benefit related to stock-based compensation.
As of June 30, 2014, we have a federal tax loss carryforward of approximately $28.9 million, consisting of $27.6 million of tax deductions in excess of book deductions related to the exercise of stock options and incentive warrants in fiscal 2014, and $1.3 million of remaining tax loss carryforwards that we acquired through the reverse merger in May 2004. The majority of the tax loss carryforwards from the reverse merger have expired without being utilized. We will be able to utilize a maximum of $0.4 million of these carryforwards in equal annual amounts through 2023 and the balance is not able to be utilized based on the provisions of IRC Section 382. We have recorded a valuation allowance for the portion of our net operating loss that is limited by IRC Section 382. The tax loss carry-forward of $27.6 million and future tax benefits resulting from the fiscal 2014 exercise of 4.6 million of our 4.8 million outstanding stock options and incentive warrants will not affect our future tax provision for financial reporting purposes, nor are we able to recognize a deferred tax asset for these future benefits. When we receive these tax benefits as a reduction of future cash taxes that would otherwise be payable, we will recognize that benefit as an increase in additional paid in capital. In addition, as of June 30, 2014, the Company has an estimated carryforward of percentage depletion in excess of basis of approximately $9.1 million. These future deductions are limited to 65% of taxable income in any period.

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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 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319 Reference 2: 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 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph h -Article 4 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=6907707&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=6907707&loc=d3e32537-109319 Reference 6: 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=6907707&loc=d3e32559-109319 + Details
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