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INCOME TAXES | 12 Months Ended
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Dec. 31, 2014
Income Tax Disclosure [Abstract] |
INCOME TAXES | 9. INCOME TAXES The components of the income tax expense from continuing operations are as follows:
|  | 2014 |  | 2013 |  | 2012 |
Current |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 10,282,000 |  | $ | 11,682,000 |  | $ | 10,380,000 |
State |  |  | 96,000 |  |  | (202,000) |  |  | 132,000 |
Total Current |  |  | 10,378,000 |  |  | 11,480,000 |  |  | 10,512,000 |
Deferred |  |  |  |  |  |  |  |  |  |
Federal |  |  | 176,000 |  |  | 365,000 |  |  | (528,000) |
State |  |  | 206,000 |  |  | 63,000 |  |  | (70,000) |
Foreign |  |  | (96,000) |  |  | - |  |  | - |
Total Deferred |  |  | 286,000 |  |  | 428,000 |  |  | (598,000) |
Total Income Tax Expense from Continuing Operations |  | $ | 10,664,000 |  | $ | 11,908,000 |  | $ | 9,914,000 |
The total tax provision for the years ended December 31, 2014, 2013, and 2012 was $4.9 million, $10.0 million, $7.4 million, respectively. Those amounts have been allocated to the following financial statement items:
|  | 2014 |  | 2013 |  | 2012 |
Income from continuing operations |  | $ | 10,664,000 |  | $ | 11,908,000 |  | $ | 9,914,000 |
Loss from discontinued operations |  |  | (5,302,000) |  |  | (1,690,000) |  |  | (1,332,000) |
Stockholders' equity, unrealized gain (loss) on investment securities |  |  | (182,000) |  |  | 143,000 |  |  | 83,000 |
Additional paid in capital, share-based compensation tax benefit |  |  | (275,000) |  |  | (383,000) |  |  | (1,265,000) |
Total Income Tax Expense |  | $ | 4,905,000 |  | $ | 9,978,000 |  | $ | 7,400,000 |
Deferred tax assets (liabilities) consisted of the following at December 31,
|  | 2014 |  | 2013 |  | 2012 |
Reserves on inventory and sales |  | $ | 291,000 |  | $ | 332,000 |  | $ | 336,000 |
Credit and loss carryforwards |  |  | 699,000 |  |  | 413,000 |  |  | 692,000 |
Stock compensation |  |  | 1,283,000 |  |  | 896,000 |  |  | - |
Accrued expenses and deferred costs |  |  | 3,170,000 |  |  | 1,260,000 |  |  | 690,000 |
Inventory capitalization |  |  | 142,000 |  |  | 337,000 |  |  | 526,000 |
Sales tax accrual |  |  | 8,000 |  |  | 337,000 |  |  | 1,228,000 |
Total deferred tax assets |  |  | 5,593,000 |  |  | 3,575,000 |  |  | 3,472,000 |
Unrealized gain/loss on investments |  |  | (294,000) |  |  | (476,000) |  |  | (333,000) |
Prepaid expenses |  |  | (779,000) |  |  | (710,000) |  |  | (752,000) |
Depreciation |  |  | (6,285,000) |  |  | (7,091,000) |  |  | (7,729,000) |
Stock compensation |  |  | - |  |  | - |  |  | (105,000) |
Total deferred tax liabilities |  |  | (7,358,000) |  |  | (8,277,000) |  |  | (8,919,000) |
Net deferred tax liabilities |  | $ | (1,765,000) |  | $ | (4,702,000) |  | $ | (5,447,000) |
The differences between the United States federal statutory tax rate and the Company's effective tax rate are as follows:
|  | 2014 |  | 2013 |  | 2012 |
Statutory federal tax |  | $ | 11,093,000 |  | 35.0 | % | $ | 13,665,000 |  | 35.0 | % | $ | 9,925,000 |  | 35.0 | %
State income taxes, net of federal benefit |  |  | 314,000 |  | 1.0 | % |  | 393,000 |  | 1.0 | % |  | 736,000 |  | 2.6 | %
Foreign Taxes |  |  | 73,000 |  | 0.2 | % |  | - |  | 0.0 | % |  | - |  | 0.0 | %
Domestic manufacturer deduction |  |  | (811,000) |  | -2.6 | % |  | (979,000) |  | -2.5 | % |  | (902,000) |  | -3.2 | %
FTC settlement |  |  | - |  | 0.0 | % |  | - |  | 0.0 | % |  | 1,389,000 |  | 4.9 | %
Other permanent differences |  |  | 200,000 |  | 0.6 | % |  | 173,000 |  | 0.4 | % |  | (190,000) |  | -0.7 | %
Research and development and jobs credits |  |  | (203,000) |  | -0.6 | % |  | (459,000) |  | -1.2 | % |  | (267,000) |  | -0.9 | %
Other state income tax benefits |  |  | (113,000) |  | -0.4 | % |  | (707,000) |  | -1.8 | % |  | (686,000) |  | -2.4 | %
Other |  |  | 111,000 |  | 0.4 | % |  | (178,000) |  | -0.4 | % |  | (91,000) |  | -0.3 | %
|  | $ | 10,664,000 |  | 33.6 | % | $ | 11,908,000 |  | 30.5 | % | $ | 9,914,000 |  | 35.0 | %
The 2014, 2013 and 2012 effective tax rates were 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 in 2012 by a $3.7 million FTC nondeductible settlement. In 2013 the Company benefited from research and development credits effective January 1, 2013, applicable retroactively to 2012 activity. In 2014 the Company benefited from research and development credits effective January 1, 2014 in addition to filing an amended federal return to claim 2010 research and development credits due to changes in Federal regulations. The Company has separate company state net operating loss carry forwards totaling $10.6 million start expiring in 2031. Maryland state credits carry forwards totaling $197,000 will begin to expire in 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://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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