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Note 9 - Income Taxes | 12 Months Ended
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Dec. 25, 2021
Notes to Financial Statements |
Income Tax Disclosure [Text Block] | (9) Income Taxes Components of income tax expense (benefit) for each year are as follows:
|  | 2021 |  |  | 2020 |
Current: |  |  |  |  |  |  |  |
Federal |  | $ | -- |  |  | $ | (39,877 | )
State |  |  | 11,967 |  |  |  | 456 |
Current income tax provision (benefit): |  |  | 11,967 |  |  |  | (39,421 | )
Deferred: |  |  |  |  |  |  |  |
Federal |  |  | (2,156,278 | ) |  |  | 33,873 |
State |  |  | (562,667 | ) |  |  | (3,000 | )
Deferred income tax provision (benefit), net |  |  | (2,718,945 | ) |  |  | 30,873 |
Total |  | $ | (2,706,978 | ) |  | $ | (8,548 | )
Deferred tax assets as of December 25, 2021 and December 26, 2020 are as follows:
|  | December 25, 2021 |  |  | December 26, 2020 |
Deferred Tax Assets: |  |  |  |  |  |  |  |
Net operating loss carryforwards |  | $ | 1,050,449 |  |  | $ | 746,397 |
Stock compensation |  |  | 157,845 |  |  |  | 540,281 |
Credit carryforwards |  |  | 1,285,119 |  |  |  | 1,288,897 |
Inventory |  |  | 77,563 |  |  |  | 116,153 |
Accrued liabilities |  |  | 12,390 |  |  |  | 22,140 |
Depreciation |  |  | 237,880 |  |  |  | 250,093 |
Other |  |  | 2,732 |  |  |  | 2,732 |
Gross deferred tax assets |  |  | 2,823,978 |  |  |  | 2,966,693 |
Valuation allowance |  |  | 0 |  |  |  | (2,849,693 | )
Net deferred tax assets |  | $ | 2,823,978 |  |  | $ | 117,000 |
At December 25, 2021 and December 26, 2020 the Company had net operating loss carryforwards of approximately $3,768,032 and $2,754,601, respectively, available to offset future income for U.S. Federal income tax purposes. These net operating loss carryforwards occurred over several years, which begin to expire in the year ended 12/31/2036. The Company established a valuation reserve as it is judged more likely than not that all or a portion of the tax credits will not be used before they expire. This decision was initially reached in 2018 after giving greater weight to its losses over the last three years compared with its forecast of the future. In September 2021 this decision was reevaluated in light of the Company’s recent profitability and its forecasts for future profitability. The Company concluded that it is “more likely than not” that the Company will be able to fully utilize the deferred tax asset. This reversal of the valuation allowance was made net of the expected tax liability for 2021. A summary of the change in the deferred tax asset is as follows:
|  | 2021 |  |  | 2020 |
Gross deferred tax balance at beginning of year |  | $ | 2,966,693 |  |  | $ | 3,321,611 |
Deferred tax benefit (provision) |  |  | (142,715 | ) |  |  | (354,918 | )
Valuation allowance |  |  | 0 |  |  |  | (2,849,693 | )
Balance at end of year, net |  | $ | 2,823,978 |  |  | $ | 117,000 |
Income tax expense is different from the amounts computed by applying the U.S. federal statutory income tax rate of 21 percent to pretax income as a result of the following:
|  | 2021 |  |  | 2020 |
Tax at statutory rate |  | $ | 106,869 |  |  | $ | 188,899 |
State tax, net of federal benefit |  |  | 36,301 |  |  |  | 360 |
Net operating loss and credit carryforwards |  |  | -- |  |  |  | 33,873 |
Valuation allowance |  |  | (2,849,693 | ) |  |  | (324,045 | )
Other |  |  | (455 | ) |  |  | 92,365 |
Total |  | $ | (2,706,978 | ) |  | $ | (8,548 | )
The Company’s income tax filings are subject to review and examination by federal and state taxing authorities. The Company is currently open to audit under the applicable statutes of limitations for the years 2018 through 2021.

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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/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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