Income Taxes

9 Months Ended

Sep. 30, 2011

Income Taxes [Abstract]

Income Tax Disclosure [Text Block]

Income Taxes

Income tax provision (benefit) for the nine months ended September 30 differed from the U.S. federal income tax rate of 34% approximately in the amounts indicated as a result of the following:

	2011			2010
Computed “expected” tax provision (benefit) at statutory rates	$	(2,293	)	$	192
Change in valuation allowance	2,906			—
Permanent differences	(19		)	(507		)
Shortfall from restricted stock units conversion	42			—
Warrant deduction	—			511
State taxes	14			37
Other	(3		)	(13		)
Total income tax provision	$	647		$	220

At September 30, 2011 the Company determined a valuation allowance against its federal deferred tax assets was necessary. A valuation allowance of approximately $2.9 million was recorded in the third quarter of 2011, which is included in the income tax provision for the three and nine months ended September 30, 2011. Due to the nature and timing of the deferred tax liabilities, the valuation allowance was established against the net deferred tax assets except for the Texas margin tax carryforward of approximately $232,000.

Differences between financial accounting principles and tax laws cause differences between the bases of certain assets and liabilities for financial reporting purposes and tax purposes. The tax effects of these differences, to the extent they are temporary, are recorded as deferred tax assets and liabilities and consisted of the following components:

	2011			2010
Deferred tax assets:
Operating loss carryforward	$	1,038		$	101
Accounts receivable allowance	56			69
Warrants	202			179
Texas tax credit carryforward	232			238
Stock option compensation	1,251			1,140
Goodwill	873			—
Accrued expenses	246			203
Alternative Minimum Tax credit carryforwards	16			16
Total deferred tax assets	3,914			1,946
Deferred tax liabilities:
Goodwill	—			(563		)
Property and equipment	(713		)	(496		)
Prepaid expense	(63		)	(41		)
Total deferred tax liabilities	(776		)	(1,100		)
Valuation allowance	(2,906		)	—
Net Deferred Tax Assets	$	232		$	846

The Company was notified during the nine months ended September 30, 2011 of an examination by tax authorities for its U.S. federal return for the year ended 2009. The examination began in April 2011 and is currently in process