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Income Taxes | 12 Months Ended
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Dec. 31, 2013
Income Taxes | (7) INCOME TAXES Income tax (benefit) expense consists of the following for the years ended December 31, 2013 and 2012:
|  | 2013 |  |  | 2012 |
Current tax (benefit) expense: |  |  |  |  |  |  |  |
Federal |  | $ | (1,835 | ) |  | $ | 784 |
State |  |  | (79 | ) |  |  | 117 |
Penalties and interest |  |  | 55 |  |  |  | 55 |
|  |  | (1,859 | ) |  |  | 956 |
Deferred tax (benefit) expense: |  |  |  |  |  |  |  |
Federal |  |  | (806 | ) |  |  | (156 | )
State |  |  | (60 | ) |  |  | (12 | )
Valuation allowance |  |  | 1,935 |  |  |  | — |
|  |  | 1,069 |  |  |  | (168 | )
|  | $ | (790 | ) |  | $ | 788 |
A reconciliation of income tax computed at the U.S. statutory rate of 34% to the effective income tax rate is as follows:
|  | 2013 |  |  | 2012 |
Statutory rate |  |  | (34 | )% |  |  | 34 | %
State taxes |  |  | (3 | ) |  |  | 3 |
Permanent differences and other |  |  | 3 |  |  |  | (4 | )
Change in valuation allowance |  |  | 24 |  |  |  | — |
Effective rate |  |  | (10 | )% |  |  | 34 | %
(7) INCOME TAXES (continued) The tax effects of temporary differences that give rise to deferred tax assets (liabilities) at December 31, 2013 and 2012 are as follows:
|  | 2013 |  |  | 2012 |
Current deferred tax assets (liabilities): |  |  |  |  |  |  |  |
Accrued expenses |  | $ | 65 |  |  | $ | 130 |
Deferred rent |  |  | - |  |  |  | 27 |
Accounts receivable |  |  | 671 |  |  |  | 673 |
Inventory |  |  | 970 |  |  |  | 1,113 |
Amortization |  |  | 135 |  |  |  | (21 | )
Prepaid expenses |  |  | (99 | ) |  |  | (67 | )
Stock based compensation |  |  | 23 |  |  |  | — |
Tax Credits and NOL Carryforward |  |  | 233 |  |  |  | — |
Other |  |  | 9 |  |  |  | — |
|  |  | 2,007 |  |  |  |  |
Less: Valuation allowance |  |  | (1,935 | ) |  |  | — |
Net current deferred tax assets |  | $ | 72 |  |  | $ | 1,855 |
Long-term deferred tax assets (liabilities): |  |  |  |  |  |  |  |
Property and equipment |  | $ | (969 | ) |  | $ | (1,182 | )
Deferred rent |  |  | 897 |  |  |  | 396 |
Net long-term deferred tax liabilities |  | $ | (72 | ) |  | $ | (786 | )
Net deferred tax liabilities |  | $ |  |  |  | $ | (786 | )
The Company generated a net loss for income tax purposes of approximately $5,200 for 2013, which will be utilized as an income tax carryback for years 2010 through 2012. As a result, the Company reduced its income tax payable by $768 and is expecting a net income tax refund of $893, which is recorded as a current asset on the balance sheet. As a result, as of December 31, 2013, the Company has no available NOL carryforwards for federal tax purposes and approximately $3,500 for State purposes, which expire at various dates ranging from five to seven years. The accounting standard related to income taxes applies to all tax positions and defines the confidence level that a tax position must meet in order to be recognized in the financial statements. This accounting standard requires that the tax effects of a position be recognized only if it is “more-likely-than-not” to be sustained by the taxing authority as of the reporting date. If a tax position is not considered “more-likely-than-not” to be sustained, then no benefits of the position are to be recognized. This accounting standard requires additional disclosures. The recognition of uncertain tax benefits are not expected to have a material impact on the Company’s effective tax rate or results of operations. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
|  | 2013 |  |  | 2012 |
Unrecognized tax benefits at the beginning of the period |  | $ | 67 |  |  | $ | 60 |
Gross increases for State income tax liabilities |  |  | 127 |  |  |  | 7 |
Unrecognized tax benefits at the end of the period |  | $ | 194 |  |  | $ | 67 |

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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 Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319 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=26873400&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 9 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319 Reference 5: 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 6: 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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