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INCOME TAXES | 12 Months Ended
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Dec. 31, 2012
Income Tax Disclosure [Abstract] |
INCOME TAXES | 10. INCOME TAXES The components of the income tax expense (benefit) are as follows:
|  | 2012 |  |  | 2011 |  |  | 2010 |
Current |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 9,787,000 |  |  | $ | 2,347,000 |  |  | $ | 9,688,000 |
State |  |  | 132,000 |  |  |  | 777,000 |  |  |  | 2,463,000 |
Total Current |  |  | 9,919,000 |  |  |  | 3,124,000 |  |  |  | 12,151,000 |
Deferred |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | (1,210,000 | ) |  | $ | 5,446,000 |  |  | $ | (62,000 | )
State |  |  | (127,000 | ) |  |  | 569,000 |  |  |  | (8,000 | )
Total Deferred |  |  | (1,337,000 | ) |  |  | 6,015,000 |  |  |  | (70,000 | )
Total Income Tax Expense |  | $ | 8,582,000 |  |  | $ | 9,139,000 |  |  | $ | 12,081,000 |
Deferred tax assets (liabilities) consisted of the following at December 31,
|  | 2012 |  |  | 2011 |  |  | 2010 |
Deferred Compensation |  |  | - |  |  |  | 301,000 |  |  |  | 314,000 |
Reserves on inventory and sales |  |  | 336,000 |  |  |  | 242,000 |  |  |  | 140,000 |
Credit and loss carryforwards |  |  | 692,000 |  |  |  | 545,000 |  |  |  | 178,000 |
Stock compensation |  |  | - |  |  |  | - |  |  |  | 601,000 |
Other |  |  | 690,000 |  |  |  | 516,000 |  |  |  | 77,000 |
Inventory Capitalization |  |  | 526,000 |  |  |  | 555,000 |  |  |  | - |
Sales tax accrual |  |  | 1,228,000 |  |  |  | - |  |  |  | - |
Total deferred tax assets |  |  | 3,472,000 |  |  |  | 2,159,000 |  |  |  | 1,310,000 |
Unrealized gain/loss on investments |  |  | (333,000 | ) |  |  | (250,000 | ) |  |  | (145,000 | )
Prepaid expenses |  |  | (752,000 | ) |  |  | (426,000 | ) |  |  | (429,000 | )
Depreciation |  |  | (7,729,000 | ) |  |  | (8,075,000 | ) |  |  | (1,317,000 | )
Stock compensation |  |  | (105,000 | ) |  |  | (109,000 | ) |  |  | - |
Total deferred tax liabilities |  |  | (8,919,000 | ) |  |  | (8,860,000 | ) |  |  | (1,891,000 | )
Net deferred tax liabilities |  | $ | (5,447,000 | ) |  | $ | (6,701,000 | ) |  | $ | (581,000 | )
The differences between the United States federal statutory tax rate and the Company's effective tax rate are as follows:
|  | 2012 |  |  | 2011 |  |  | 2010 |
Statutory federal tax |  | $ | 8,559,000 |  |  |  | 35.0 | % |  | $ | 9,688,000 |  |  |  | 35.0 | % |  | $ | 11,093,000 |  |  |  | 35.0 | %
State income taxes, net of federal benefit |  |  | 679,000 |  |  |  | 2.8 | % |  |  | 1,015,000 |  |  |  | 3.7 | % |  |  | 1,699,000 |  |  |  | 5.4 | %
Domestic manufacturer deduction |  |  | (902,000 | ) |  |  | -3.7 | % |  |  | (248,000 | ) |  |  | -0.9 | % |  |  | (861,000 | ) |  |  | -2.7 | %
FTC settlement |  |  | 1,389,000 |  |  |  | 5.7 | % |  |  | - |  |  |  |  |  |  |  | - |  |  |  |  |
Other permanent differences |  |  | (190,000 | ) |  |  | -0.8 | % |  |  | 71,000 |  |  |  | 0.3 | % |  |  | 75,000 |  |  |  | 0.2 | %
Research and development and jobs credits |  |  | (267,000 | ) |  |  | -1.1 | % |  |  | (336,000 | ) |  |  | -1.2 | % |  |  | - |  |  |  |  |
Other state income tax benefits |  |  | (686,000 | ) |  |  | -2.8 | % |  |  | (1,051,000 | ) |  |  | -3.9 | % |  |  | - |  |  |  |  |
Other |  |  | - |  |  |  |  |  |  |  | - |  |  |  |  |  |  |  | 75,000 |  |  |  | 0.2 | %
|  | $ | 8,582,000 |  |  |  | 35.1 | % |  | $ | 9,139,000 |  |  |  | 33.0 | % |  | $ | 12,081,000 |  |  |  | 38.1 | %
The 2012 and 2011 effective tax rate is impacted by the Company’s extensive state income tax planning. This planning includes taking advantage of Maryland’s apportionment methodology. As a manufacturing entity based in Maryland, the Company utilizes the single sales factor apportionment method in addition to claiming new state jobs credits and research & development credits. These benefits were offset by a $3.7 million FTC nondeductible settlement in 2012. The Company has federal capital loss carry forwards of approximately $287,000 that can be carried forward for five years and will expire in 2014 through 2017. Separate company state net operating loss carry forwards totaling $5.4 million start expiring in 2031. Maryland state credits carry forwards totaling $293,000 and a Pennsylvania credit carry forward totaling $29,000 will expire in 2017.

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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 Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 136, 172 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. 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=6881521&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 15 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 43, 44, 45, 46, 47, 48, 49 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 6: 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 7: 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 8: 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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