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INCOME TAXES | 12 Months Ended
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Dec. 31, 2012
INCOME TAXES |
INCOME TAXES | NOTE H - INCOME TAXES The income tax provision charged to continuing operations for the years ended December 31, 2012, 2011, and 2010, was as follows:
|  | 2012 |  | 2011 |  | 2010 |
Current: |  |  |  |  |  |  |
U.S. federal |  | $ | 3,947,400 |  | $ | 35,561 |  | $ | (190,869 | )
Foreign |  | 5,313,874 |  | 3,343,374 |  | 250,190 |
State and local |  | 264,269 |  | 698,362 |  | 374,029 |
|  | 9,525,543 |  | 4,077,297 |  | 433,350 |
Deferred expense |  | 359,535 |  | 2,469,953 |  | 146,550 |
|  | $ | 9,885,078 |  | $ | 6,547,250 |  | $ | 579,900 |
The components of the Company’s income before income tax expense attributable to domestic and foreign operations amounted to $6,018,971 and $19,537,986, respectively, for the year ended December 31, 2012. The components of the Company’s income before income tax expense attributable to domestic and foreign operations amounted to $6,085,192 and $11,295,273, respectively, for the year ended December 31, 2011. The components of the Company’s loss before income tax expense attributable to domestic and foreign operations amounted to $(3,002,790) and $2,360,008, respectively, for the year ended December 31, 2010. The income tax provision differs from the amount of income tax determined by applying the U.S. federal income tax rate (35% for 2012, 34% for 2011 and 2010) to pretax income (loss) from continuing operations for the years ended December 31, 2012, 2011, and 2010, due to the following:
|  | 2012 |  | 2011 |  | 2010 |
Computed “expected” tax expense |  | $ | 8,944,935 |  | $ | 5,909,358 |  | $ | (218,546 | )
Increase (decrease) in income taxes resulting from: |  |  |  |  |  |  |
Change in effective rates used for deferred taxes |  | — |  | (503,693 | ) | — |
Nondeductible expenses and other |  | 768,652 |  | 534,742 |  | 548,943 |
State and local taxes, net of federal benefit |  | 171,491 |  | 606,843 |  | 249,503 |
|  | $ | 9,885,078 |  | $ | 6,547,250 |  | $ | 579,900 |
Net deferred tax liabilities consist of the following components as of December 31, 2012 and 2011:
|  | 2012 |  | 2011 |
Deferred tax assets |  |  |  |  |
Foreign tax credits |  | $ | 473,405 |  | $ | 2,034,130 |
Net operating loss carry forwards |  | 462,548 |  | 776,647 |
Other |  | 92,983 |  | — |
Total deferred tax assets |  | 1,028,936 |  | 2,810,777 |
Deferred tax liability |  |  |  |  |
Property, equipment, and intangible asset |  | (8,646,047 | ) | (10,068,353 | )
Total deferred tax liabilities |  | $ | (7,617,111 | ) | $ | (7,257,576 | )
The components giving rise to the net deferred tax items described above have been included in the accompanying balance sheets as of December 31, 2012 and 2011, as follows:
|  | 2012 |  | 2011 |
Current assets |  | $ | — |  | $ | — |
Noncurrent (liabilities) |  | (7,617,111 | ) | (7,257,576 | )
|  | $ | (7,617,111 | ) | $ | (7,257,576 | )
As of December 31, 2012, the Company has U.S. net operating loss carry forwards for U.S. federal income tax purposes of approximately $1.4 million. These net operating losses are available to offset future federal taxable income, if any, and expire from 2027 through 2030. The amount of net operating loss carry forwards that may reduce federal income taxes in any given year are subject to annual limitations and taxable income requirements. The foreign tax credit of $473,405 expires in 2020. The Company files a U.S. consolidated federal income tax return for operating activities in the U.S. and Canada. The Company also files federal and local tax returns in Canada, as well as state tax returns in a number of state and local jurisdictions in the U.S. The Company’s U.S. federal income tax returns filed for 2009 through 2011 are subject to audit by the IRS. The Company’s income tax returns filed in Canada for 2009 through 2011 remain subject to examination by Canadian authorities. As of December 31, 2012 and 2011, the Company had no unrecognized tax benefits within its provision for income taxes.

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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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