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Income Taxes | 12 Months Ended
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Sep. 30, 2019
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with the liability method. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reflected on the balance sheet when it is determined that it is more likely than not that the asset will be realized. This guidance also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some or all of the deferred tax asset will not be realized. We will also set up a valuation allowance, reducing the carrying value of deferred tax assets if it is more likely than not that some or all of the deferred tax asset will not be realized, based on estimated future taxable income. Presently, the Company has no deferred tax asset valuation allowances. During the fiscal year ending September 30, 2018, the Company recognized a $3.4 million write-down of deferred tax assets from revaluation of our net operating loss carryforwards from the previously recognized federal income tax rate of 34% to the 21% rate in the 2017 Tax Act enacted in December 2017. In addition to this discrete item the Company recognized $2.4 million of income tax expense associated with current operations resulting in total income tax expense of $5.8 million for the 2018 fiscal year. The fiscal year 2018 effective tax rate, excluding the discrete item associated with the deferred tax asset write-down was 32.2% as compared to the prior year effective tax rate of 39.1%. The effective tax rate for fiscal 2019 was 29%. At September 30, 2019 and 2018, respectively, the Company had federal net operating losses of approximately $17.2 million and $23.8 million. The Company utilized approximately $7.2 million of federal net operating losses to offset taxes otherwise currently due in 2020. The federal NOLs begin to expire in 2021 and continue to expire through 2033. The Company has no material state net operating losses carryforward. A provision of the 2017 Tax Act repealed the alternative minimum tax (AMT). Additionally, prior AMT paid is either creditable against regular tax liability or refundable. For tax years beginning after 2017 and before 2022, 50 percent of AMT credits are refundable; from 2022, the credits are fully refundable. The Company has AMT credits of $366 thousand as of the year ended September 30, 2019, of which 50 percent has been established as an income tax receivable in current assets. An analysis of the Company's deferred tax assets and liabilities is as follows:
|  | Year Ended
|  | September 30,
(amounts in thousands) |  | 2019 |  | 2018
Deferred income tax assets: |  |  |  |
Net operating loss carry forwards |  | $ | 3,926 |  |  | $ | 5,005 |
AMT credit carryforward |  | 183 |  |  | 185 |
Stock based compensation |  | 140 |  |  | 140 |
Accrued expenses |  | 1,666 |  |  | 1,202 |
Other items, net |  | 45 |  |  | 45 |
Total deferred tax asset |  | 5,960 |  |  | 6,577 |
Deferred tax liability: |  |  |  |
Equipment and intangible assets |  | (3,615 | ) |  | (2,440 | )
Net deferred tax asset |  | $ | 2,345 |  |  | $ | 4,137 |
The significant components of income tax expense for income taxes from continuing operations are summarized as follows:
|  | Year Ended
|  | September 30,
(amounts in thousands) |  | 2019 |  | 2018
Current expense |  | $ | 379 |  |  | $ | 328 |
Deferred expense |  | 1,792 |  |  | 5,502 |
Total expense |  | $ | 2,171 |  |  | $ | 5,830 |
The following table indicates the significant differences between our income taxes at the federal statutory rate and the Company's effective tax rate for continuing operations:
|  | Year Ended
|  | September 30,
(amounts in thousands) | Ref | 2019 |  | 2018
Federal statutory rate |  | $ | 1,574 |  |  | $ | 1,861 |
State taxes, net |  | 407 |  |  | 393 |
Other permanent items |  | 91 |  |  | 77 |
Deferred tax estimate adjustment |  | 99 |  |  | 134 |
Discrete item | (a) | — |  |  | 3,365 |
Total |  | $ | 2,171 |  |  | $ | 5,830 |
(a): Write-down of deferred tax assets due to change in federal income tax rate from the 2017 Tax Act. We file income tax returns in the U.S. federal jurisdiction and in various state jurisdictions. We are no longer subject to income tax examinations for years before 2015.

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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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