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INCOME TAXES | 12 Months Ended
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Dec. 31, 2016
Income Tax Disclosure [Abstract] |
INCOME TAXES | INCOME TAXES The Company’s provision for income taxes from continuing operations for the years ended December 31, 2016 and 2015 relates to income taxes in states, foreign countries and other local jurisdictions and differs from the amounts determined by applying the statutory Federal income tax rate to loss before income taxes for the following reasons:
|  | Dollars in Thousands
|  | 2016 |  | 2015
Benefit at federal rate |  | $ | (2,812 | ) |  | $ | (3,449 | )
Increase (decrease) resulting from: |  |  |  |
State income taxes—net of federal benefit |  | (301 | ) |  | (320 | )
Miscellaneous permanent differences |  | 6 |  |  | 163 |
Liability warrants |  | (268 | ) |  | 70 |
Capitalized transaction cost |  | 244 |  |  | — |
State, net operating loss expiration/true-up |  | 25 |  |  | (187 | )
Other—net |  | — |  |  | (119 | )
Valuation allowance |  | 3,106 |  |  | 3,842 |
Total income tax expense (benefit) |  | $ | — |  |  | $ | — |
|  | Dollars in Thousands
|  | 2016 |  | 2015
Federal: |  |  |  |
Current |  | $ | — |  |  | $ | — |
Deferred |  | — |  |  | — |
Total Federal |  | $ | — |  |  | $ | — |
State: |  |  |  |
Current |  | $ | — |  |  | $ | — |
Deferred |  | — |  |  | — |
Total State |  | $ | — |  |  | $ | — |
Foreign: |  |  |  |
Current |  | $ | — |  |  | $ | — |
Deferred |  | — |  |  | — |
Total Foreign |  | $ | — |  |  | $ | — |
Total Tax Provision |  | $ | — |  |  | $ | — |
The Company’s deferred income tax asset from continuing operations at December 31, 2016 and 2015 is comprised of the following temporary differences:
|  | Dollars in Thousands
|  | 2016 |  | 2015
Deferred Tax Asset: |  |  |  |
Net operating loss carryforward |  | $ | 60,276 |  |  | $ | 51,449 |
Research and development credit carryforwards |  | 918 |  |  | 918 |
Other |  | 116 |  |  | 585 |
|  | 61,310 |  |  | 52,952 |
Less valuation allowance |  | (61,310 | ) |  | (52,902 | )
Deferred Tax Asset |  | $ | — |  |  | $ | 50 |
Deferred Tax Liability: |  |  |  |
Property and equipment |  | — |  |  | 50 |
Deferred Tax Liability |  | $ | — |  |  | $ | 50 |
Net Deferred Asset (Liability) |  | $ | — |  |  | $ | — |
At December 31, 2016, we had total unused federal tax net operating loss carryforwards of $167.9 million. The expiration dates are as follows (amounts in thousands):
2018 | $ | 1,838 |
2019 | 8,181 |
2020 | 9,662 |
2021 | 8,228 |
2022 | 16,862 |
2023 | 16,173 |
2024 | 17,390 |
2025 | 8,153 |
2026 | 6,792 |
2027 | 3,238 |
2028 | 1,272 |
2029 | 591 |
2031 | 2,784 |
2032 | 8,358 |
2033 | 12,097 |
2034 | 7,591 |
2035 | 15,147 |
2036 | 23,499 |
Total | $ | 167,856 |
Of these federal net operating loss carryforwards, $1.2 million were obtained in the acquisition of Annovis, Inc. and may be subject to certain restrictions. Remaining net operating loss carryforwards could be subject to limitations under section 382 of the Internal Revenue Code of 1986, as amended. At December 31, 2016, we had unused state tax net operating loss carryforwards of approximately $62.0 million that expire at various times beginning in 2018. At December 31, 2016, we had unused research and development credit carryforwards of $0.9 million that expire at various times between 2018 and 2028. As a result of the asset purchase agreement in November of 2015 which included the stock of our subsidiary Transgenomic Limited, the Company no longer has foreign operating loss carryforwards. We will continue to assess the recoverability of deferred tax assets and the related valuation allowance. To the extent we begin to generate income in future years and it is determined that such valuation allowance is no longer required, the tax benefit of the remaining deferred tax assets will be recognized at such time. It is likely that the proposed Merger will be a change in control that will limit the use of the net operating loss carryforwards. We had no material interest or penalties during fiscal 2016 or fiscal 2015, and we do not anticipate any such items during the next twelve months. Our policy is to record interest and penalties directly related to income taxes as income tax expense in the Consolidated Statements of Operations. We file income tax returns in the U.S. federal jurisdiction, various U.S. state jurisdictions and various foreign jurisdictions. We have statutes of limitation open for Federal income tax returns related to tax years 2012 through 2016. We have state income tax returns subject to examination primarily for tax years 2012 through 2016. To the extent the Company has tax attribute carryforwards, the tax years in which the attribute was generated may still be adjusted upon examination by the Internal Revenue Service, state or foreign tax authorities to the extent utilized in a future period. Open tax years related to foreign jurisdictions remain subject to examination. Our primary foreign jurisdiction is the United Kingdom, which has open tax years for 2011 through 2015. During November 2015, the FASB issued ASU 2015-17, “Balance Sheet Classification of Deferred Taxes”, which simplifies the presentation of deferred income taxes. This ASU requires that deferred tax assets and liabilities be classified as non-current in a statement of financial position.

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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 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 2: 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=65882285&loc=d3e32559-109319 Reference 3: 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=65882285&loc=d3e32718-109319 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=65882285&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=65882285&loc=d3e32537-109319 + Details
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