INCOME TAXES	6 Months Ended
Jun. 30, 2016
INCOME TAXES
INCOME TAXES	9. INCOME TAXES The Company recorded an income tax benefit of $1,208,000 and $2,176,000 on pretax losses of $12,797,000 and $22,365,000 during the three and six months ended June 30, 2016 which represents an effective tax rate of 9.4% and 9.7%, respectively. The Company recorded an income tax benefit of $6,372,000 and $9,685,000 on pretax losses of $18,249,000 and $28,154,000 during the three and six months ended June 30, 2015 which represents effective tax rates of 34.9% and 34.4%, respectively. The Company assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit the use of the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss incurred over the three year period ended December 31, 2015. Such objective evidence limits the ability to consider other subjective evidence, such as projections for taxable earnings. The income tax benefit for the three and six months ended June 30, 2016 do not include income tax benefits for all of the losses incurred because the Company recorded a valuation allowance against part of its federal net operating loss deferred tax assets. In addition, the Company increased its valuation allowance for part of its state net operating loss deferred tax assets. The Company has recorded a valuation allowance against the associated deferred tax assets for the amounts it deems are not more likely than not realizable. Based on Management’s belief that not all the net operating losses are realizable, a federal valuation allowance of $3,353,000 and $5,713,000 and an additional state valuation allowance of $55,000 and $116,000 was recorded during the three and six months ended June 30, 2016. In addition, due to our recent operating losses and valuation allowance, the Company may recognize reduced or no tax benefits on future losses on the Condensed Consolidated Statements of Operations and Comprehensive Loss. The amount of the valuation allowance considered realizable, however, could be adjusted if estimates of future taxable income during the carryforward period are reduced or increased, or if objective negative evidence in the form of cumulative losses is no longer present and additional weight is given to subjective evidence such as projections for future growth.

9. INCOME TAXES

The Company recorded an income tax benefit of $1,208,000 and $2,176,000 on pretax losses of $12,797,000 and $22,365,000 during the three and six months ended June 30, 2016 which represents an effective tax rate of 9.4% and 9.7%, respectively. The Company recorded an income tax benefit of $6,372,000 and $9,685,000 on pretax losses of $18,249,000 and $28,154,000 during the three and six months ended June 30, 2015 which represents effective tax rates of 34.9% and 34.4%, respectively.

The Company assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit the use of the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss incurred over the three year period ended December 31, 2015. Such objective evidence limits the ability to consider other subjective evidence, such as projections for taxable earnings.

The income tax benefit for the three and six months ended June 30, 2016 do not include income tax benefits for all of the losses incurred because the Company recorded a valuation allowance against part of its federal net operating loss deferred tax assets. In addition, the Company increased its valuation allowance for part of its state net operating loss deferred tax assets. The Company has recorded a valuation allowance against the associated deferred tax assets for the amounts it deems are not more likely than not realizable. Based on Management’s belief that not all the net operating losses are realizable, a federal valuation allowance of $3,353,000 and $5,713,000 and an additional state valuation allowance of $55,000 and $116,000 was recorded during the three and six months ended June 30, 2016. In addition, due to our recent operating losses and valuation allowance, the Company may recognize reduced or no tax benefits on future losses on the Condensed Consolidated Statements of Operations and Comprehensive Loss. The amount of the valuation allowance considered realizable, however, could be adjusted if estimates of future taxable income during the carryforward period are reduced or increased, or if objective negative evidence in the form of cumulative losses is no longer present and additional weight is given to subjective evidence such as projections for future growth.