XML 33 R19.htm IDEA: XBRL DOCUMENT
v3.20.2

Income Taxes | 12 Months Ended
--- | ---
Jun. 30, 2020
Income Tax Disclosure [Abstract] |
Income Taxes | (11) Income Taxes The Company accounts for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for the expected tax consequences of temporary differences between the tax bases of assets and liabilities and their reported amounts. Valuation allowances are established, when necessary, to reduce deferred tax assets to amounts that are more likely than not to be realized. As of June 30, 2020 and 2019, the Company had established a full valuation allowance against all of its net deferred tax assets. For the fiscal year ended June 30, 2020, the Company incurred losses from operations in the amount of $8.3 million. There is no effective tax rate for the fiscal year 2020. There is no current state tax expense. FASB ASC 740, Income Taxes addresses the accounting for uncertainty in income taxes recognized in an entity’s financial statements and prescribes a recognition threshold and measurement attribute for financial statement disclosure of tax positions taken or expected to be taken on a tax return. The Company had no unrecognized tax benefit for the years ended June 30, 2020 and 2019. For the years ended June 30, 2020 and 2019, the Company’s effective tax rate differed from the federal statutory rate of 21%, primarily due to prior year deferred true ups and the valuation allowance against its net deferred tax assets. The CARES Act was signed into law on March 27, 2020. The CARES Act provided certain tax relief measures including the acceleration of the alternative minimum credit previously paid. The CARES Act allows for the acceleration of the refundable AMT credit up to 100% of the AMT credit. In response to the impact of the CARES Act, the AMT credit still to be received by the Company of $429 thousand for AMT previously paid will be refunded in full and reclassed from long-term to short-term income tax receivable in the filing of the return for the fiscal year ended June 30, 2020. SAB 118 Measurement Period The Company applied the guidance in SAB 118 when accounting for the enactment-date effects of the Tax Cuts and Jobs Act in 2017 and throughout 2018. At June 30, 2018, the Company had not completed its accounting for all the enactment-date income tax effects of the Tax Cuts and Jobs Act under ASC 740, Income Taxes, for remeasurement of deferred tax assets and liabilities. As of December 22, 2018, the Company completed its accounting for all of the enactment-date income tax effects of the Tax Cuts and Jobs Act. As further discussed below, during fiscal year 2019, the Company recognized adjustments of $509 thousand to the provisional amounts recorded at June 30, 2019 and included these adjustments as a component of gross deferred taxes before valuation allowance. Deferred Tax Assets and Liabilities As of June 30, 2018, the Company remeasured certain deferred tax assets and liabilities based on the rates at which they were expected to reverse in the future (which was generally 21%), by recording a provisional amount of $8.5 million. Upon further analysis of certain aspects of the Tax Cuts and Jobs Act and refinement of calculations during the year ended June 30, 2019, the Company adjusted its provisional amount by $509 thousand, which is included as a component of gross deferred taxes before valuation allowance. Loss carryovers are generally subject to modification by tax authorities until three years after they have been utilized. The components of income tax benefit from operations are as follows:
|  | Year Ended June 30, |
(In thousands) |  | 2020 |  |  | 2019 |
Current |  |  |  |  |  |  |  |
Federal |  | $ | — |  |  | $ | 858 |
State and local |  |  | — |  |  |  | — |
Total current tax benefit |  | $ | — |  |  | $ | 858 |
Deferred |  |  |  |  |  |  |  |
Federal |  |  | — |  |  |  | — |
State and local |  |  | — |  |  |  | — |
Total deferred tax benefit |  | $ | — |  |  | $ | — |
Total tax benefit |  | $ | — |  |  | $ | 858 |
A reconciliation of the reported income tax benefit to the amount that would result by applying the U.S. Federal statutory rate to the loss before income taxes to the actual amount of income tax benefit recognized follows:
|  | Year Ended June 30, |
(In thousands) |  | 2020 |  |  | 2019 |
Expected benefit |  | $ | 1,746 |  |  | $ | 1,763 |
State tax expense |  |  | — |  |  |  | — |
Change in valuation allowance |  |  | 2,961 |  |  |  | (1,325 | )
Prior year true-up |  |  | (4,650 | ) |  |  | — |
Other permanent items |  |  | (57 | ) |  |  | (9 | )
Total income tax benefit |  | $ | — |  |  | $ | 429 |
The Company’s deferred tax assets as of June 30, 2020 and 2019 consist of the following:
|  | Year Ended June 30, |
(In thousands) |  | 2020 |  |  | 2019 |
Deferred tax assets: |  |  |  |  |  |  |  |
Net operating loss carryforwards |  | $ | 14,786 |  |  | $ | 17,738 |
Alternative minimum tax credit carryforwards |  |  | — |  |  |  | — |
Lease liability - current and non-current |  |  | 202 |  |  |  | — |
Accrued expenses and other timing |  |  | 1,047 |  |  |  | 1,100 |
Property and equipment, principally due to differences in depreciation |  |  | 85 |  |  |  | — |
Total gross deferred tax assets |  | $ | 16,120 |  |  | $ | 18,838 |
Less — valuation allowance |  |  | (15,941 | ) |  |  | (18,903 | )
Net deferred tax assets |  | $ | 179 |  |  | $ | (65 | )
Deferred tax liabilities: |  |  |  |  |  |  |  |
Right-of-use assets |  | $ | (179 | ) |  | $ | — |
Property and equipment, principally due to differences in depreciation |  |  | — |  |  |  | 65 |
Total gross deferred tax liabilities |  |  | (179 | ) |  |  | 65 |
Net deferred tax assets |  | $ | — |  |  | $ | — |
The Company files consolidated returns for federal, Florida, and Texas income and franchise taxes. In assessing the need for a valuation allowance, management considers whether it is more likely than not that some portion or all of the net deferred tax assets will be utilized to offset future tax liabilities. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. As of June 30, 2020, the Company provided a full valuation allowance of approximately $15.9 million against its net deferred tax assets. This deferred tax asset will be presented as a long-term tax receivable. The valuation allowance increased by approximately $3.0 million for the year ended June 30, 2020. Since the Company reflects a full valuation allowance against its deferred tax assets, there has been no income tax impact from these changes. The Tax Cuts and Jobs Act enacted on December 22, 2017 repealed the alternative minimum tax and any available alternative minimum tax credit will be refunded according to the guidelines of the Tax Cuts and Jobs Act. The alternative minimum tax credit is limited to 50% of the available balance each year for tax years 2018 to 2020 and any remaining balance is fully refundable for tax year 2021. The CARES Act enacted on March 27, 2020 included the acceleration of the alternative minimum tax credit and allows for the acceleration of the refundable AMT credit up to 100% of the AMT credit. The alternative minimum tax credit amount available is $0 thousand. At June 30, 2020, the Company had net operating loss carryforwards of approximately $68.8 million with approximately $41.1 million ($8.6 million, tax effected) for federal income tax purposes that are available to offset future regular taxable income set to expire between the years of 2020 and 2037. The Company also had net operating loss carryforwards with indefinite lives of approximately $27.7 million ($5.8 million, tax effected) for federal income tax purposes that are available to offset future regular taxable income. For net operating losses with indefinite carryforward lives, generated beginning after December 31, 2017, the Tax Cuts and Jobs Act limits the amount of net operating losses to be utilized and deducted by the taxpayer to 80% of the taxpayer’s taxable income. Utilization of some of these net operating losses is limited due to the changes in stock ownership of the Company associated with the October 2007 Exchange Offer; as such, the benefit from these losses may not be realized. At June 30, 2020, the Company also has accumulated state net operating loss carryforwards of approximately $7.4 million ($0.3 million, tax effected) that are available to offset future state taxable income. These net operating loss carryforwards expire between the years 2026 and 2038. These losses may also be subject to utilization limitations; as such, the benefit from these losses may not be realized. The Company has a temporary credit for business loss carryovers that may be utilized to offset its Texas margin tax. At June 30, 2020, the credit amount is $0.5 million ($0.3 million, tax effected). These credits may be used to offset $13 thousand of state tax liability each year and will expire in 2027. Uncertain Tax Positions The Company had no uncertain tax positions at June 30, 2020 and 2019. The Company recognizes interest and penalties related to income tax matters in income tax expense, as incurred. For the years ended June 30, 2020 and 2019, the Company did not recognize any interest expense for uncertain tax positions.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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=84230637&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=116825942&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=84230637&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=116825942&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=84230637&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 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration