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Income Taxes
 12 Months Ended
Apr. 30, 2025
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Income tax expense/(benefit) from operations consists of the following (in thousands):
For the Years Ended April 30,
202520242023
Current:
Federal (a)$48 $5 $(126)
State (b)64 (79)(123)
Foreign11 4 — 
Total current123 (70)(249)
Deferred:
Deferred federal— — — 
Deferred state— — — 
Total deferred— — — 
Total income tax expense/(benefit)$123 $(70)$(249)
The following table presents a reconciliation of the provision for income taxes from operations at statutory rates to the provision (benefit) in the consolidated financial statements (in thousands):
For the Years Ended April 30,
202520242023
Federal income taxes expected at the statutory rate (c)$10 $(2,587)$(2,577)
State income taxes, less federal income tax benefit14 (132)(303)
Stock compensation249 436 96 
Research and development tax credit(149)(203)(200)
Change in deferred tax valuation allowance(192)2,257 2,600 
Other191 159 135 
Total income tax expense/(benefit)$123 $(70)$(249)
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(a)Federal current expense is net of $875,000 tax benefit of operating loss carryforwards.
(b)State current expense is net of $95,000 tax benefit of operating loss carryforwards.
(c)We had a federal statutory rate of 21% in fiscal 2025, 2024, and 2023.
Deferred tax assets (liabilities) related to temporary differences are the following (in thousands):
April 30, 2025April 30, 2024
Non-current tax assets (liabilities):
Inventories$1,321 $1,100 
Accrued expenses, including compensation2,261 1,589 
Workers' compensation13 10 
Warranty reserve322 286 
Stock-based compensation991 1,066 
State bonus depreciation56 110 
Property, plant, and equipment(1,974)(2,619)
Intangible assets11,059 11,777 
Right-of Use assets(7,401)(7,740)
Right-of Use lease liabilities7,724 7,985 
Capitalized R&D2,649 2,136 
Other(182)(83)
Loss and credit carryforwards2,267 3,681 
Less valuation allowance(19,106)(19,298)
Net deferred tax asset/(liability) — total$— $— 
As of April 30, 2025, federal and state net operating loss, or NOL, carryforwards were $7.7 million and $5.4 million, respectively, and $382,000 of federal research & development tax credits. The tax-effected deferred tax assets recorded for federal and state NOL carryforwards were $1.6 million and $278,000, respectively. Under legislation enacted in 2017, informally titled the Tax Cuts and Jobs Act, or Tax Act, federal NOLs incurred in taxable years ending after December 31, 2017, may be carried forward indefinitely. The federal research and development credits of $382,000, which, if unused, will expire between April 30, 2043 and 2044. State NOL carryforwards of $4.5 million, which, if unused, will expire in years April 30, 2033 through April 30, 2044. The remaining $900,000 of the state NOL carryforwards may also be carried forward indefinitely.
As of April 30, 2025, we continued to maintain a full valuation allowance of $19.1 million against our net deferred income tax assets based on management's assessment that it was more likely than not that our deferred income tax assets will not be recovered. We will continue to evaluate the need for a valuation allowance on our deferred tax assets until there is sufficient positive evidence to support the reversal of all or some portion of these allowances. As of April 30, 2024, we maintained a full valuation allowance of $19.3 million against our net deferred income tax assets based on management's assessment that it was more likely than not that our deferred income tax assets will not be recovered.
The income tax provisions (benefit) represent effective tax rates of 267.4%, 0.6%, and 2.0% for the fiscal years ended April 30, 2025, 2024, and 2023, respectively.
U.S. income taxes have not been provided on $400,000 of undistributed earnings of our foreign subsidiary since it is our intention to permanently reinvest such earnings offshore. If the earnings were distributed in the form of dividends, we would not be subject to U.S. tax as a result of the Tax Act but could be subject to foreign income and withholding taxes. Determination of the amount of this unrecognized deferred income tax liability is not practical.
As of April 30, 2025 and 2024, we did not have any gross tax-effected unrecognized tax benefits.
With limited exception, we are subject to U.S. federal, state, and local, or non-U.S. income tax audits by tax authorities for fiscal years subsequent to April 30, 2021. On March 7, 2023, the Internal Revenue Service (“IRS”) initiated an examination of our Federal income tax return filed for the tax period ended April 30, 2022. On January 10, 2024, we were notified from the IRS that they had concluded their examination. As a result of their examination procedures, our tax liability was unchanged for the tax period under examination, and there was no impact to our consolidated financial statements.