XML 32 R18.htm IDEA: XBRL DOCUMENT

Income Taxes

12 Months Ended

Dec. 31, 2020

12. Income Taxes

The Company’s components of loss before income tax (in thousands) were as follows:


	Year Ended December 31,
	2020		2019
Domestic	$	(15,116)	$	(14,097)
Foreign		1,944		(1,355)
Loss before income tax	$	(13,172)	$	(15,452)

The Company’s components of income tax (expense) benefit (in thousands) were as follows:


	Year Ended December 31,
	2020		2019
Current federal benefit	$	117	$	285
Current state expense		(131)		(69)
Deferred federal expense		(268)		(251)
Deferred state benefit		258		127
Deferred foreign benefit		—		147
Income tax (expense) benefit	$	(24)	$	239

The income tax provision (in thousands) differs from the amount computed by applying the statutory federal income tax rate to loss before income tax as follows:


	Year Ended December 31,
	2020		2019
Tax benefit computed at statutory rate of 21%	$	2,766	$	3,245
Change in valuation allowance		(2,152)		(5,744)
State income tax benefit, net of federal tax		100		46
Foreign (income) loss		(536)		2,827
Other		(202)		(135)
Income tax (expense) benefit	$	(24)	$	239

The Coronavirus Aid, Relief, and Economic Security Act (“The CARES Act”) was enacted on March 27, 2020 resulting in tax law changes that impacted the Company by accelerating the AMT credit owed to the Company and allowed for a temporary change in NOL taxable income limitations. For tax years beginning January 1, 2018 and those prior to 2021, an NOL deduction equal to 100% of taxable income is allowed. Tax years 2021 and forward will revert back to the 80% limitation established by the 2017 Tax Cuts and Jobs Act.

The Consolidated Appropriations Act, 2021 (“The ACT”) was enacted by Congress on December 27, 2020. The Company is evaluating the effect of The ACT and does not anticipate a material impact to its consolidated financial statements.

The principal components of the Company’s net deferred tax assets (liabilities) (in thousands) were as follows:


	December 31,
	2020		2019
Deferred tax assets:
Federal tax net operating loss ("NOL") carryforward	$	26,754	$	25,921
Foreign tax NOL carryforward		6,244		6,418
State tax NOL carryforward		1,509		1,692
Other comprehensive income		273		379
Restricted stock and restricted stock unit awards		230		316
Foreign deferred taxes		207		242
Right-of-use assets		124		193
Canadian start-up costs		104		122
Self-insurance		62		106
Workers’ compensation		44		96
Deferred revenue		—		351
Alternative Minimum Tax ("AMT") credit carryforward		—		79
Other		51		90
Gross deferred tax assets		35,602		36,005
Less valuation allowances		(30,396)		(28,299)
Net deferred tax assets		5,206		7,706
Deferred tax liabilities:
Property and equipment		(5,225)		(7,649)
Net deferred tax (liabilities) assets	$	(19)	$	57
Domestic deferred tax (liabilities) assets	$	(19)	$	57
Foreign deferred tax liabilities		—		—
Net deferred tax (liabilities) assets	$	(19)	$	57

At December 31, 2020, the Company had a gross NOL for U.S. federal income tax purposes of approximately $127,399,000. This NOL will begin to expire in 2027. Losses incurred after the year ended December 31, 2017 have no expiration. The Company will carry forward the tax benefits related to federal net NOL of approximately $26,754,000. The Company also had state net NOLs that will affect state taxes of approximately $1,509,000 at December 31, 2020. State NOLs began to expire in 2015. The Company also had a Canadian gross NOL of $24,016,000 that will begin to expire in 2037.

In evaluating the possible sources of taxable income during 2020, the Company determined it is more likely than not that the remaining deferred tax assets will not be realizable. As a result, the Company recorded full valuation allowance against foreign deferred tax assets and its federal and state deferred tax assets with the exception of its trademark intangible. As one of the Company’s Canadian subsidiaries reported taxable income for 2020 and 2019, the Company will continue to monitor the need for valuation allowance release on that subsidiary’s NOL in upcoming periods.

At December 31, 2020 and 2019, the Company did not have any uncertain tax positions. The Company’s policy is to recognize interest and penalties related to an uncertain tax position in income tax expense.

- 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 + Details