9.Income Taxes

The Company utilizes the asset and liability approach to measuring deferred tax assets and liabilities based on temporary differences existing at each balance sheet date using currently enacted tax rates in accordance with FASB ASC 740-10-30. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

The income tax provision (benefit) for the three and nine months ended September 30, 2014 and 2013 consists of the following:


	Three Months Ended September 30,					Nine Months Ended September 30,
	2014		2013			2014			2013
Current Income Taxes	$	3,737	$	(391,000	)	$	11,852		$	(1,042,000	)

Deferred Income Taxes
Federal		14,000		(793,000	)		(1,048,000	)		(207,000	)
State		2,000		(82,000	)		(106,000	)		(33,000	)

Total Provision (Benefit)	$	19,737	$	(1,266,000	)	$	(1,142,148	)	$	(1,282,000	)

The Company has no liabilities for unrecognized tax benefits.

The Companys policy is to recognize potential interest and penalties accrued related to unrecognized tax benefits within income tax provision (benefit). For the nine months ended September 30, 2014 and 2013, the Company did not recognize any interest or penalties in the condensed consolidated statement of operations, nor did the Company have any interest or penalties accrued in the condensed consolidated balance sheet at September 30, 2014 and December 31, 2013, relating to unrecognized benefits.

The Company reported a net deferred tax asset of $5,035,000 on its condensed consolidated balance sheet as of September 30, 2014. GAAP requires the consideration of a valuation allowance for deferred tax assets if it is more likely than not that some component or all of the benefits of deferred tax assets will not be realized. The Company has determined that no valuation allowance is necessary related to the deferred tax assets at September 30, 2014. The net operating loss carry forward of $19.3 million that was generated in the year ended December 31, 2013 was caused by the tax expense related to the satisfaction of promissory notes with the issuance of the Companys common stock and the Companys pro rata share of the bonus depreciation that DPTS recorded related to the Pioneer Terminal for income tax purposes. The Company had taxable income in the year ended December 31, 2012 and anticipates taxable income for the year ending December 31, 2014.

The 2013, 2012, 2011 and 2010 tax years remain open to examination for federal income tax purposes and by the other major taxing jurisdictions to which the Company is subject.