INCOME TAXES

6 Months Ended

Mar. 31, 2013

INCOME TAXES

INCOME TAXES

7. INCOME TAXES

The components of loss before income taxes, after adjusting the loss for non-controlling interests, are as follows:

	Three months ended								Six months ended
	March 31,								March 31,
	2013				2012				2013				2012
United States		$	(1,014,000	)		$	(2,972,000	)		$	(2,302,000	)		$	(4,302,000	)
Canada		(2,702,000		)		(12,000		)		(4,724,000		)		1,526,000
		$	(3,716,000	)		$	(2,984,000	)		$	(7,026,000	)		$	(2,776,000	)

The components of the income tax (benefit) provision are as follows:

	Three months ended								Six months ended
	March 31,								March 31,
	2013				2012				2013				2012
Current		$	(214,000	)		$	105,000			$	344,000			$	663,000
Deferred		(558,000		)		(108,000		)		(1,680,000		)		(176,000		)
		$	(772,000	)		$	(3,000	)		$	(1,336,000	)		$	487,000

Barnwell’s effective consolidated income tax rate for the three and six months ended March 31, 2013, after adjusting loss before income taxes for non-controlling interests, was 21% and 19%, respectively, as compared to 0% and (18%) for the three and six months ended March 31, 2012, respectively.

Consolidated taxes do not bear a customary relationship to pretax (losses) earnings due primarily to the fact that Canadian income taxes are not sheltered by current period U.S. source losses, Canadian income taxes are not estimated to have a current or future benefit as foreign tax credits or deductions for U.S. tax purposes, and U.S. consolidated net operating losses are not estimated to have any future U.S. tax benefit prior to expiration.

The Canada Revenue Agency is currently examining the Company’s Canadian federal income tax returns for fiscal 2010 and 2011.