NOTE 11: INCOME TAXES

12 Months Ended

Dec. 31, 2011

Income Tax Disclosure [Text Block]

NOTE 11:INCOME TAXES

The provision for income taxes is comprised of the following for the years ended December 31, 2011 and 2010.  The provision for income taxes differs from the amount computed by applying the U.S. statutory income tax rate before income taxes for the reasons set forth below for the years ended December 31, 2011 and 2010. 

	December 31, 2011			December 31, 2010
Federal:
Current	$	-		$	-
Deferred		-			-
Total Federal	$	-		$	-
State:
Current	$	(55	)	$	175
Deferred		-			-
Total State	$	(55	)	$	175
Total income tax (benefit) expense	$	(55	)	$	175

	For the Year Ended
	December 31, 2011		December 31, 2010
Income tax expense at federal statutory rate		34.00%		34.00%
State taxes, net of federal expense		4.41%		(0.41)%
Return to provision adjustments		44.42%		0.00%
Goodwill impairment		0.00%		(4.72)%
Valuation allowance		(83.56)%		(32.32)%
State rate differential		0.00%		2.10%
Permanent differences		0.23%		(0.28)%
Other, net		(2.13)%		0.63%
Total effective rate		(2.63)%		(1.00)%

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, as well as operating loss and tax credit carry forwards.  The tax effects of the temporary differences and carry forwards are as follow at December 31, 2011 and 2010: 

	December 31, 2011			December 31, 2010
Deferred tax assets:
Allowance for bad debt	$	10		$	85
Net operating loss		5,801			4,091
Share-based compensation		523			121
Investment in joint venture		3,565			7,200
Other		36			15
Total deferred tax assets	$	9,935		$	11,512
Deferred tax liabilities:
Depreciation on property and equipment	$	(1,966	)	$	(1,649	)
Intangible amortization		(830	)		(984	)
Total deferred tax liabilities	$	(2,796	)	$	(2,633	)
Less: valuation allowance		(7,139	)		(8,879	)
Net deferred tax liabilities	$	-		$	-

We have $15,407 in net operating loss (“NOL”) carry forwards available to offset future or prior taxable income.  These federal NOL’s will expire at various dates through 2028. Management analyzed its current operating results and future projections and determined that a full valuation allowance was needed due to our cumulative losses in recent years.  We have no uncertain tax positions at December 31, 2011.